GREEN INDUSTRY DEVELOPMENT EFFORTS IN INDONESIA
INNOVATIVE BUSINESS SOLUTIONS
ON GREEN INDUSTRY
Tokyo Green Industry Conference 2011
16 - 18 November 2011
MINISTRY OF INDUSTRY
REPUBLIC OF INDONESIA
1
OUTLINE
I.
II.
III.
IV.
Background
Green Industry Concept
Energy Conservation Program
Government Bisnis Model Green Industry
Development
V. Green Industry Development Chalenges
VI . Closing
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I. BACKGROUND
1. Current Industrial Condition
• Industrial development in Indonesia has been running for
50 years. Besides giving positive contribution to the
country, it also result in environmental problem especially
pollution due to industrial waste and inefficient use of
natural resources.
• Due to limitation of natural resources
availability, energy crisis, and drop of
environmental carrying capacity, the
development of eco-friendly industry or
as known as green industry is a must.
3
2. Global Market Trend
• Trade liberalization, resulting in the decrease of trade-related
tariff (or even none).
• Implementation of non-tariff policies, such as cleaner
production and eco-product standards, Renewal Energy
Directive (RED) and REACH have become a constraint for
Indonesian products export, especially to enter European and
American countries.
• Global market trend towards eco-product is
a chance that should be anticipated as well
as gained for benefits.
• To compete in global market eco-friendly
industry or green industry development
which able to create eco-products is a
must.
4
3. Government’s Commitment to Reduce Greenhouse Gases
Emission
President’s Commitment at G-20
Pittsburgh and COP15
Reducing greenhou gases emission in 2020
26%
26%
Self-initiatives/ funding
41%
15%
Selfinitiatives
plus
international
support/
funding
Nat. Action Plan on GHG
5



Indonesia total Greenhouse Gases
(GHG) emission from all sectors in
2000: 1,377,982.95 Gg CO2e
GHG Contributors :
1. Land use change & forestry
59.6%
2. Energy 20.4%
3. Waste11.42%
4. Industry 3.12%
5. Agriculture 5.47%
GHG Contributors (Industrial
sector only):
1.
2.
3.
4.
5.
6.
7.
8.
20.4 %
3.12 %
59.6%
5.47 %
11.42 %
Source: SECOND NATIONAL COMMUNICATION-SNC,
NOV 2010
Cement
Metal and Steel
Textile
Pulp and paper
Petrochemical
Fertilizer
Glass and ceramics
Food and beverages
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4. Industrial Development Policy
Long-Term Industrial Development - National Goal
(President’s Decree No. 28 Year 2008 about National Industrial
Policy)
Developing industries with
Sustainable development concept
Economy
Development of
industries which
capable of
continuously
producing goods as
demanded by market.
Environment
Development of industries which
capable of maintaining ecosystem
balance, sustainable use of
natural resources, and prevent
natural resources exploitation as
well as carry out environmental
preservation function.
Social
Development of industries
which deliver social
contribution such as creating
job vacancies, better
education, health, and
security.
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II. Green Industry Concept
Business as Usual
Packaging
Technology/
Equipment
Supplier
Raw and
additional
material
Product
Production
Process
Waste/
Emission
Green Industry
Energy
Eco
Friendly
• Eco-friendly
• Efficient and
effective
• Renewable (if
available
Products
and
packaging
leftovers
• 3R implementation
(Reduce, Reuse, Recycle,)
• Environmentally conscious
human resources
• SOP Application
• Efficient and effective
Factory layout
• Equipment modification
• Eco-Product
• Eco-Packaging
• Low/ zero emission
• Proper treatment
based on standards
• Non hazardous
• Reusable
(inside/outside
process)
Eco
Friendly
Green Production
SUPPORTING
•Standards
•Certification Body
•Cooperation
• Funding
•Incentive
•Education and training
•R & D
• Technical Assistance
• Information
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System
III. Energy Conservation Program
Industry is the highest energy consumers
Energy Usage
(Million BOE)
Transportation
Oil
314.1 (50,0%)
32,6%
Gas
79,2 (12,6%)
Coal
145,1 (23,1%)
LPG
11,4
Energy Source
Industry
47,2%
(1,8%)
Electricity
79.1 (12,6%)
Total
628,8
Oil
share
is
still
very
dominant
Household &
Comercial
20,2%
Source: Ministry of Energy and Mineral
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Resources, 2008
Grand Strategy of Energy Conservation and CO2 Emission Reduction in
Industrial Sector 2010 - 2020
10
Energy Conservation Implementation Stages
and CO2 Emission Reduction in Industrial Sector (2010 -2020)
1. Phase 1 : Implementation of Energy Conservation and CO2 Emission
Reduction in Industrial Sector;
2. Phase 2 : Promotion of CO2 emission reduction through several
pilot project in energy voracious industries such as steel, pulp and
paper industries;
3. Phase 3: Establishment of Energy Services Company (ESCO)
4. Phase 4 : Eco-Label Implementation
 Since 2010, assistances in energy
conservation implementation have been
conducted at 35 steel industries and 15
pulp & paper industries.
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IV. Government Bisnis Model Green Industry Development
1. Pilot Project Machinery Restructurization in Textile Industry PT.
Daliatex-Bandung / Water and Energy (NEDO support – 2007 )
a. Dyeing Unit
No
Utility
Energy and Water
Usage Before Changing
The Machine
Energy and Water
Usage After
Changing The
Machine
1.
Electricity
6,757
MJ/Ton
1,9316 MJ/ton
2.
Steam
12,230 MJ/Ton
6,978 MJ/ton
Total Energy
100%
47%
Total Water
112 ton/ton
68,9 ton/ton
100%
61.6%
3
Efficiency (%)
53%
38,3
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b. Tenter Unit (Drying and Color Fixation)
No.
Utility
Energy usage
before
applying
cleaner
production
Energy usage
after applying
cleaner
production
1.
Electricity
1,395 MJ/Ton
1,257 MJ/ton
2.
Heat (Steam)
8,632 MJ/Ton
4,579 MJ/ton
Total Energy
100%
58,25
Efficiency
(%)
41,75
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c. Dryer Unit
No.
Utility
Energy usage
before applying
cleaner
production
Energy usage
after applying
cleaner
production
1.
Electricity
3,083 MJ/Ton
2,302 MJ/ton
2.
Heat (Steam)
7,730 MJ/Ton
2,446 MJ/ton
Total Energy
100%
55 %
Efficiency (%)
45 %
Conclusion:
With NEDO support, efficiency achieved at PT.
Daliatex:
•Energy
: 52%
1. Industry become
•Water
: 38%
more efficient
•
2. Eco-friendly
•Chemicals : 20-25%
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2. Restructurization Program for Textile and Textile
Products, Footwear, and Sugar Industries
a. Background
 Approximately 80% machinery used in those industries
aged more than 20 years and consumed a lot of
resources (water and energy), non-environmental
friendly.
 Low efficiency, unpunctual delivery time
 Low competitiveness
 Flooding of Imported products
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b. Objective:
Giving stimulus (grant) for machine renewal in order to raise
the competitiveness and environmental preservation.
c. Form of Grant:
 Granting 10% of investment cost support with the
maximum amount of 5 billion Rupiahs/company/budget
year.
 15 % cost reduction for local machinery
products purchasing, proved by the
calculation of machinery’s local contents.
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d. Realization of Machinery Restucturization Program
Impact of the Program:
Textile and Textile
Products
619 companies
Sugar
Footwear
78 companies
50 companies
(2009-2010)
(2009 - 2010)
•Increasing production
capacity: 1,52%
•Increasing grinding
effectiveness:
1,2%
•Increasing steam efficiency:
0,09%
•Increasing energy
efficiency: 22-25 %
•Increasing production
capacity: 29,75%
•Increasing productivity:
5,46%
•Increasing job
employment: 21.700
people.
(2007 - 2010)
•Increasing energy saving:
6-18%
•Increasing productivity:
7-17 %
•Increasing production:
15-28 %
•Increasing job
employment : 55.000
people
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3. CO2 Emission Reduction Program in Industrial Sector
a. CO2 emission inventory in 8 industrial sectors, i.e. cement, steel,
pulp & paper, petrochemical, fertilizer, ceramic, textile, food and
beverage;
b. Formulation of CO2 emission reduction roadmap for cement
industry.
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4. Technical Assistance in Cleaner Production:
 Technical assistance in identifying chances of efficiency
enhancement, conducting analysis and evaluation of
economical, technical, and environmental feasibility.
Technical Assistance had been given to:
1.Food Industry (PT Niramas – Bekasi);
2.Coating Industry (PT Hempel – Bekasi);
3.Fish Canning Industry (PT Avila Prima – Banyuwangi);
4.Cosmetics Industry (PT Sparindo – Tangerang);
5.Electroplating Industry (PT Citra Inti – Tangerang)
 According to cleaner production result,
industries can optimize the use of resources
(energy, water, and raw material) to be more
efficient and eco-friendly.
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Result:
Cleaner Production Recomendation
No.
Industry
Potential
Savings
(Rp/year)
Investment
Cost (Rp)
1,858,032,005 559,490,540
Source of Savings
1.
Food
Efficient use of water,
plastics, and flour
2.
Coating
976,388,204
11,900,000
Efficient use of packaging
and solvent
3.
Fish Canning
977,500,614
119,053,750
Efficient use of Water,
energy, packaging and
rejected products
4.
Cosmetics
188,069,845
8,010,000
Efficient use of raw
materials, alcohol, water,
and energy.
5.
Electroplating
147,502,000
12,647,000
Efficient use B3 (NiSO4,
Ni Cl2, CrO3,
BO3, H2SO4), water and
energy
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Electroplating Industry (PT Citra Inti - Tangerang ), cont’d…
Unit
Operation
Cleaner Production
Actions
Benefit
Investment
Cost (Rp)
Potential
savings
(Rp/year)
NickelChromium
Coating
Installing additional
anode in chromium
tank
Minimization of
waste due to less
rejected products
3,000,000
*
Zinc Coating
Insulating heating
tubs
Reduce heat loss
1,197,000
-
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IV . GREEN INDUSTRY DEVELOPMENT CHALLENGES
1. Needs of machinery renewal/equipment modification.
 Investment is needed in order to renew/modify the
equipments. In the other hand, bank interest is high (14
%) and there’s no existing domestic machinery
industries.
2. Reward for industrial practitioners who have
implemented green industry, such as funding, technical
assistance, etc. to support continuous improvement.
3. Appropriate green industry incentive
formulation.
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VI. CLOSING
Establishment and development of Green Industry need a
lot of support from all stakeholders and national or
international related institutions. To achieve the goal –
green industry implementation, Indonesia needs good
cooperation from other countries through regional or
international forums and international organization.
THANK YOU
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