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Biodiesel: Powering the Renewable Energy Revolution

By September 13, 2022No Comments

On 1 January 2020, Indonesia officially launched the B30 Programme, becoming the first country in the world to use 30% biodiesel as standard at the fuel pumps. The arrival of this renewable source of energy raised a number of questions: what is biodiesel fuel? How is it made? And can it really replace petroleum? Apical has the answers…

 

What is biodiesel?

Biodiesel is a renewable, biodegradable fuel made from vegetable oils such as palm, soybean, canola and corn. This makes it a cleaner, more sustainable alternative to petroleum diesel.

 

How is it made?

 Biodiesel is made from waste vegetable oils and animal fats, in a chemical process called transesterification. During this process, glycerine is separated from the fat or vegetable oil using methanol. What’s left is methyl esters – the technical name for biodiesel.

 

What are the benefits of biodiesel?

 Biodiesel is a clean-burning, renewable substitute for petroleum diesel. Produced domestically, it provides a range of environmental benefits, while also supporting the Indonesian economy and offering a pathway for social development.

 

Here are just five of the main benefits biodiesel can provide:

  1. Energy efficiency
  2. Sustainability
  3. Reduction in emissions
  4. Lowering of foreign oil dependency
  5. Domestic economic development

 

Is it ready now, or is this one for the future?

One of the clearest short-term benefits of biodiesel is that it is compatible with existing engines and infrastructure. Today, more than 78% of diesel vehicles rolling off production lines are approved for biodiesel. This means that making the switch to renewable energy is fast, convenient and relatively inexpensive.

In the long-term, biodiesel can also dramatically reduce pollution and help to combat climate change. By leaning towards biodiesel for its energy needs, Indonesia can reduce its dependency on diesel oil imports, reduce emissions and improve air quality, while also creating new jobs.

 

Is biodiesel safe?

Biodiesel is less combustible than petroleum, making it safer to handle, store and transport. This also means it causes significantly less damage to the environment and is much easier to manage in the event of oil spills.

 

How sustainable is biodiesel?

 Biofuels are fully biodegradable and burn cleaner than gasoline, resulting in fewer greenhouse gas emissions. What’s more, the CO2 released during biodiesel combustion is offset by the carbon dioxide absorbed from growing soybeans or other feedstocks used to produce the fuel. This makes it a sustainable, renewable source of energy.

Air quality is another major positive of biodiesel, as its emissions are lower in particulate matter (PM), carbon monoxide (CO) and hydrocarbon (HC). Recent studies by the Argonne National Laboratory and the California Air Resources Board (CARB) found that making the switch from petroleum to biodiesel could reduce COemissions by around 74%.

 

Biodiesel in Indonesia

In Indonesia, the raw material for biodiesel comes from crude palm oil (CPO). The archipelago is home to 12.76 million hectares of oil palm plantations, which produce around 36.59 million tonnes of CPO – approximately 60% of global palm oil production.

With its wealth of natural resources and existing CPO infrastructure, Indonesia has enormous growth potential. As global demand for biofuel develops, Indonesia can position itself as one of the world’s biggest producers.

Biodiesel is saving us a lot of money in reducing import expenditure,” explains Jummy Bismar Martua, who is the Head of Research and Technology at the Indonesian Biofuel Producers Association (APROBI) and Head of Commercial Biodiesel for Apical.

This can help Indonesia break its dependence on diesel from international providers, and then replace it with existing local resources. Moreover, according to Martua, “savings from import expenditure can be allocated to other purposes.”

 

Government plans for biodiesel development

 Indonesia’s government sees biodiesel as the future; a renewable source of energy that could be the key to achieving the country’s 2030 Sustainable Development Goals (SDGs). “The biodiesel programme in Indonesia is a good solution for our future,” says Martua, who also highlights the need for synergy between sectors in the development and testing of biodiesel. “With the right industry and sustainable resources, this can be very beneficial for everyone”, he adds.

Apical is helping the Indonesian government to reach its targets and bring its 2030 vision into focus. As the country’s second-largest biodiesel producer, Apical has allocated 80% of its production to support the government’s agenda. In July 2022, the Energy and Mineral Resources Ministry also launched the B35 programme; an initiative that aims to boost the palm oil content of biodiesel to around 35%.

In the years ahead, Indonesia’s biodiesel programmes are expected to benefit Indonesian society and the nation’s economy in a number of ways, by raising CPO prices and providing a cleaner alternative to more traditional fuels. In addition, Indonesia’s biodiesel mandate is expected to help reduce poverty and hunger rates, provide employment and improve gender equality.

 

Challenges and opportunities: the future of biodiesel

 In 2019, the BP Energy Outlook forecast that global energy consumption would grow by 17 billion tonnes of oil in the next 20 years. An estimated 85% of this total will be covered by renewable energy and natural gas.

Despite its enormous potential, certain challenges remain. Several aspects of biodiesel technology still need to be ironed out, such as water content, contaminants and monoglyceride; limited capacity, which currently only meets local demand; the high price differential between biodiesel and diesel; and various other logistical challenges related to supply chains and transport.

The potential benefits offered by biodiesel far outweigh the challenges associated with its development. Now the government has committed to raising production, industry players like Apical are leading the way. With producers, politicians and experts all pulling together, the future looks bright for biodiesel.

 

Top 5 biodiesel facts

 Switching to biodiesel could reduce CO2 emissions by 74%

  • 5 billion tonnes of renewable energy needed between now and 2040
  • Palm oil will make up 35% of biodiesel in Indonesia
  • Global demand for biodiesel is expected to grow by 6% in the next decade
  • Apical produces around 80% of Indonesia’s biodiesel

Di Apical Group, komitmen kami terhadap keberlanjutan didukung penuh dimulai dari jajaran managemen teratas. Presiden Apical didukung oleh Direktur Keberlanjutan bersama seluruh kepala bisnis, memastikan keberlanjutan terintegrasi dalam unit bisnis dan fungsional, dan tertanam dalam nilai dan inisiatif inti perusahaan.

Topik keberlanjutan dibahas pada rapat dewan yang diadakan setiap tiga bulan. Kami juga memiliki tim keberlanjutan yang berdedikasi berbasis di Kuala Lumpur; Malaysia, dan Indonesia; Pekanbaru, Dumai, Medan, Jakarta dan Balikpapan. Tim Keberlanjutan ditugaskan untuk menerapkan dan memantau komitmen kami melalui keterlibatan dan kolaborasi pemangku kepentingan yang konstruktif.

Selain itu, kami didukung penuh oleh departemen Sosial, Keamanan, dan Perizinan (SSL) khusus di setiap unit bisnis yang kami miliki, untuk menangani masalah sosial dan perizinan sesuai dengan peraturan nasional serta kebijakan keberlanjutan Apical. Tim juga mengawasi program Tanggung Jawab Sosial Perusahaan (CSR) untuk mendukung penghidupan yang lebih baik di masyarakat setempat.

Mencapai tujuan keberlanjutan membutuhkan lebih dari sekadar kolaborasi dengan pemangku kepentingan utama kami. Kolaborasi lintas industri dan perusahaan sejenis juga penting dan karenanya, kami terus mencari dan berpartisipasi dalam kemitraan baru, keanggotaan industri yang relevan, dan skema sertifikasi.

Kami berpartisipasi dalam skema keanggotaan dan sertifikasi industri seperti Tropical Forest Alliance 2020, Roundtable on Sustainable Palm Oil (RSPO), termasuk P&C Review Taskforce RSPO dan National Interpretation Working Group RSPO Indonesia, International Sustainability and Carbon Certification (ISCC), dan Indonesian Sustainable Palm Oil (ISPO).

Dato' Yeo How

PRESIDEN APICAL GROUP

At Apical Group, our commitment to sustainability stems right from the top. Apical’s President is supported by the Director of Sustainability and various business heads, to ensure sustainability is integrated within business and functional units, and embedded in the company’s core values and initiatives.

Sustainability topics are discussed at Board meetings held quarterly. We also have dedicated Sustainability teams based in Kuala Lumpur, Malaysia, and Pekanbaru, Dumai, Medan, Jakarta and Balikpapan in Indonesia. The Sustainability teams are tasked with implementing and monitoring our commitments through constructive stakeholder engagement and collaboration.

In addition, there is also a dedicated Social, Security and Licensing (SSL) department in each refinery we own, to handle social and licensing matters in compliance with national regulations as well as Apical Sustainability Policy. The team also oversees Corporate Social Responsibility (CSR) programmes to support better livelihoods in local communities.

Achieving sustainability goals requires more than just collaboration with our key stakeholders. Collaboration across industries and peer companies is also crucial and hence, we constantly look for and participate in new partnerships, relevant industry membership and certification schemes.

We participate in industry membership and certification schemes such as the Tropical Forest Alliance 2020, Roundtable on Sustainable Palm Oil (RSPO), including the RSPO P&C Review Taskforce and the RSPO Indonesia National Interpretation Working Group, the International Sustainability and Carbon Certification (ISCC), and the Indonesian Sustainable Palm Oil (ISPO)

Dato' Yeo How

APICAL GROUP PRESIDENT