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PALM-BASED BIOENERGY DIVERSIFICATION INNOVATION FOR FOSSILENERGY SUBSTITUTION

  • First Published : Juni 13, 2025 12:45 pm
  • Last Update : September 8, 2025 12:58 pm
Dr. Ir. Tungkot Sipayung
JOURNAL AUTHOR

Dr. ir. tungkot sipayung

Executive Director at PASPI

Dr. Ir. Tungkot Sipayung is a seasoned professional in the palm oil industry with over 23 years of experience. Currently serving as Executive Director of PASPI, he is a recognized leader and expert in the development of agribusiness strategies. Under his leadership, PASPI continues to drive growth, innovation, and sustainability in the industry.

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PASPI. (2025). PALM-BASED BIOENERGY DIVERSIFICATION INNOVATION FOR FOSSILENERGY SUBSTITUTION. JOURNAL ANALYSIS OF PALM OIL STRATEGIC ISSUES. 02(03). https://palmoilina.asia/wp-content/uploads/2025/07/PALM-BASED-BIOENERGY-DIVERSIFICATION-INNOVATION-FOR-FOSSIL-ENERGY-SUBSTITUTION-1.pdf
PASPI. PALM-BASED BIOENERGY DIVERSIFICATION INNOVATION FOR FOSSILENERGY SUBSTITUTION. JOURNAL ANALYSIS OF PALM OIL STRATEGIC ISSUES. 2025;02(03):%page_number%. Available from: https://palmoilina.asia/wp-content/uploads/2025/07/PALM-BASED-BIOENERGY-DIVERSIFICATION-INNOVATION-FOR-FOSSIL-ENERGY-SUBSTITUTION-1.pdf.
PASPI. "PALM-BASED BIOENERGY DIVERSIFICATION INNOVATION FOR FOSSILENERGY SUBSTITUTION." JOURNAL ANALYSIS OF PALM OIL STRATEGIC ISSUES, vol. 02, 2025, pp. %page_number%. https://palmoilina.asia/wp-content/uploads/2025/07/PALM-BASED-BIOENERGY-DIVERSIFICATION-INNOVATION-FOR-FOSSIL-ENERGY-SUBSTITUTION-1.pdf. Diakses Pada : .

TLDR

Palm oil–based bioenergy has become a strategic instrument for Indonesia’s national energy security through various technological innovations developed under the Palm Oil Research Grant (GRS) program of BPDP. These include improvements in biodiesel, the development of green fuels, utilization of biomass, and optimization of POME-based biogas to sustainably substitute fossil energy.

Palm oil–based bioenergy has emerged as one of the main pillars of Indonesia’s national energy security strategy. As the world’s largest palm oil producer, Indonesia possesses vast potential to develop diverse forms of bioenergy that can reduce dependence on imported fossil fuels. Beyond energy security, this development also contributes significantly to improving the trade balance, reducing greenhouse gas emissions, and advancing rural economic development.

Why is Palm Oil–Based Bioenergy a Strategic Priority for Indonesia?

Palm oil bioenergy plays a multidimensional strategic role in Indonesia’s national development. Its acceleration is driven by five fundamental factors that reinforce the urgency of large-scale implementation:

  1. Reducing Dependence on Imported Fossil Fuels
    Since 2004, Indonesia has shifted from being a net exporter to a net importer of fossil fuels. Fossil diesel consumption rose from 23.1 million kiloliters in 2010 to 32.1 million kiloliters in 2022; gasoline use jumped from 23.1 to 41.9 million kiloliters; and jet fuel consumption increased from 2.7 to 7.3 million kiloliters. As a result, energy imports now account for about 50% of total domestic fossil fuel consumption.
  2. Improving Indonesia’s Oil and Gas Trade Balance
    Heavy reliance on imported energy has drained the country’s foreign exchange reserves. The oil and gas trade deficit ballooned from USD 6.4 billion in 2015 to USD 34.7 billion in 2022. Substituting fossil energy imports with domestically produced palm oil bioenergy can significantly reduce this deficit.
  3. Mitigating Climate Change by Reducing Greenhouse Gas Emissions
    Fossil fuel consumption is the main contributor to Indonesia’s rising greenhouse gas (GHG) emissions—from 0.96 Gt CO₂-eq in 2015 to 1.24 Gt CO₂-eq, with fossil fuels accounting for 54% of the total. The IPCC has issued a stark warning: “Stop fossil fuels before it’s too late.” Replacing fossil fuels with bioenergy has been proven to cut GHG emissions by 50–70%.
  4. Promoting Rural Development through Expanded Bioenergy Feedstock Markets
    The growth of the bioenergy industry stimulates palm oil cultivation in rural areas, generating a multiplier effect on local economies. Studies show that the biodiesel mandate (B30) provides the greatest income gains for agricultural households, particularly smallholder palm oil farmers.
  5. Strengthening Indonesia’s Leverage in the Global Palm Oil Market
    Palm oil bioenergy also serves as a strategic policy tool. As the largest palm oil producer, Indonesia’s domestic use of palm oil for biofuels influences global market dynamics, giving the country stronger geopolitical and trade bargaining power.

How Do Palm Plantations Harvest Solar Energy for Bioenergy?

Palm oil bioenergy essentially captures and stores solar energy through photosynthesis, converting it into chemical energy within palm oil and biomass. Oil palm plantations can thus be viewed as energy plantations: as long as the sun shines, the conversion of solar energy into usable energy will continue sustainably.

bioenergy
Gambar 2. Bioenergi Berbasis Sawit sebagai Bagian Ketahanan Energi

From a chemical perspective, palm fatty acids closely resemble the hydrocarbon structures found in fossil fuels. With proper conversion technologies, fatty acids in palm oil can be transformed into hydrocarbon-based fuels such as green diesel, green gasoline, and sustainable aviation fuel (SAF).

Three Generations of Palm Oil–Based Bioenergy

  1. First-Generation Bioenergy
    Derived from palm oil (CPO/PKO), producing biodiesel, green diesel, green gasoline, and green jet fuel. Processing also yields biogas as a joint product.
  2. Second-Generation Bioenergy
    Utilizes palm biomass residues—empty fruit bunches, shells, trunks, and fronds—through thermochemical, biological, or chemical conversion to produce bioethanol, biocoal, briquettes, and biogas. With 16.8 million hectares of oil palm plantations, Indonesia can generate up to 272 million tons of biomass annually.
  3. Third-Generation Bioenergy
    Produced from Palm Oil Mill Effluent (POME) using methane capture technology, generating biogas and biomethane. These have been widely used as local electricity sources, particularly for rural communities near palm oil mills.

Recent Innovations in Palm Oil Bioenergy

Most of Indonesia’s bioenergy use currently comes from biodiesel, supported by a production capacity of 20 million kiloliters and a mandatory biodiesel program (moving toward B40). However, continuous innovations under the GRS program have expanded to include:

  • New feedstocks such as Palm Acid Oil (PAO) and Palm Fatty Acid Distillate (PFAD), previously considered low-value byproducts.
  • Catalyst innovations including glycerol-based and potassium carbonate catalysts from palm oil waste, reducing reliance on imports.
  • Process improvements using enzymatic production, catalytic hydrogen transfer for oxidative stability, and optimized logistics for distribution.
  • Expanded applications beyond transport, including agriculture machinery, mining equipment, shipping, railways, and power generation.
  • Advanced fuels such as green diesel, green gasoline, and green jet fuel (bioavtur), supported by cutting-edge catalysts like Katalis Merah Putih and biocatalysts from microalgae.
  • Biomass utilization for biocoal, bio-oil, dimethyl ether (DME), and bioethanol.
  • POME-derived innovations for high-quality biogas, biomethane, and even biochemicals like formic acid and furfural.

Conclusion

Palm oil–based bioenergy development in Indonesia is driven by five key benefits: reducing fossil fuel imports, improving the oil and gas trade balance, mitigating climate change, fostering rural economic growth, and strengthening Indonesia’s strategic role in global palm oil trade.

Indonesia’s bioenergy roadmap follows three main pathways:

  1. First-generation (CPO/PKO-based fuels: biodiesel, green diesel, green gasoline, and green jet fuel).
  2. Second-generation (biomass-based fuels: bioethanol, biocoal, biopellets).
  3. Third-generation (POME-based fuels: biogas and biomethane).

The GRS program has produced a wide range of innovations in feedstocks, catalysts, processes, and products. Accelerating their commercialization will help Indonesia realize a vision of sustainable energy independence while creating new business opportunities, jobs, and domestic value-added growth.

ACKNOWLEDGEMENT

The author gratefully acknowledges the financial support provided by the Palm Oil Plantation Fund Management Agency (BPDP) in the preparation of this journal article.

To access the full journal article, please download the file using the button below.

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