Application of Bio-CNG technology in Indonesia

Programme description

Programme description

From 2001 to 2018, Indonesia lost 9.27 million ha of tree cover in primary forests, leading to a total of 4.97 Gt CO₂ emissions, and furthermore contributing to deforestation. According to the World Resources Institute’s Global Forest Watch, oil palm plantations seemed to have been the largest single driver of deforestation, resulting in 23% of deforestation in Indonesia.
Land clearing for palm production of primary forest and peat land leads to dramatic land use changes and can count for up 72% of total emissions in palm oil production. Excluding emissions derived from deforestation, during the production of crude palm oil, emissions are primarily generated from Palm Oil Mill Effluent (POME), fertilizer use into the palm oil plantation and the use of diesel for transport and machinery. Emissions arising from operations during oil palm growing and fresh fruit bunches (FFB) processing count for up to 28% of total emissions in the sector. Of these, emissions from POME account for 71%, fertilizer emissions for 23% and transport emissions for 6% of all operations’ emissions (and they represent respectively the 20%, 6% and 2% of total emission in palm oil production).

POME aerobic pond

In order to drastically reduce the emissions of the Palm Oil Industry in Indonesia, the proposed project calls for the capture of the biogas produced by POME, its treatment and upgrading into a biofuel, referred to as Bio-CNG. The programme also makes use of the Bio-CNG as a diesel replacement for transport and electricity generation in this sector. This project has been designed to increase incentives for palm oil mills to adopt sustainable certifications and to hinder them from contributing to further deforestation. In order to disincentivize deforestation, this programme will launch a palm oil mill participation program using a certification scheme as a criterium. It will pay close attention to plantations near peat swamp forests, whose preservation will be critical for reducing national greenhouse gas emissions in Indonesia.


The main root causes and barriers for Bio-CNG technology development in Indonesia are the following:
1.  High investment and operating costs for Bio-CNG technology
2. National and international financial institutions not financing Bio-CNG technology
3. Lack of incentives to unlock mitigation potential
4. Bio-CNG technology currently not known in Indonesia
5. Lack of an off-taker for Bio-CNG
6. Regulatory uncertainty


The proposed programme, called “Circular economy of industrial effluents for low emission transport through the application of Bio-CNG technology in Indonesia”, introduces a technological innovation in Indonesia and aims at reducing emissions from the palm oil industry. At the same time, the Bio-CNG produced will be used for transport and power generation in the palm oil industry and it will have a lower price than commonly used diesel, therefore producing economic benefits.
Other co-benefits from the introduction of this model include the potential use of the digestate produced by the POME treatment technology as a fertilizer for nearby fields. Most importantly, the potential reduction of deforestation for establishing new plantations is also very significative. Deforestation reduction is linked to the fact that the biofuel (Bio-CNG) from palm oil industry waste will substitute palm oil derived biodiesel, thus allowing to reduce the surface needed for meeting the Government objectives on biodiesel blend to decrease Indonesia fuel import dependency.


The investment Programme provides two main components, of which Component 1 includes the main Bio-CNG installations which are the main technology transferred by this project:
1) POME to Bio-CNG production and filling station for Bio-CNG use
2) Truck/genset conversion

Process flow

Bio-CNG installation

(1 upgrading; 2 flare; 3 dryer; 4 scrubber; 5 compressor; 6 membranes; 7 odorization; 8 injection; 9 chiller; 10 boiler; 11 filling station)

Bio-CNG installation

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