1. 7 TH 2016, Annual Power & Electricity Indonesia Seminar Development of Biomass Power Plants –Energy Forest Policy across Indonesia Presented by Dr. Harun Al Rosyid M Eng. PT.Indopower International -STTPLN

2. 7 TH 2016, Annual Power & Electricity Indonesia Seminar Introduction Indonesia’s current installed power capacity is at 52GW and the government has an ambitious plan to increase another 35,000MW in another five years. Demand is expected to grow at an average of 8.4% p.a. due to rapid urbanization and industrialization. The Indonesian President has recently announced his new target in achieving 23% use of renewable energy in the national energy mix by 2025 with various policy frameworks taking shape to attract more foreign direct investment to meet the increasing demand of electricity in Indonesia. To achieve this, investment of 1,600 trillion rupiah is required. This investment value by 2025 is divided into 475 trillion for geothermal, 645 trillion bioenergy, 320 trillion for hydro and 160 trillion for new energy.

3. Biomass potential recourses in Indonesia 3 Power Plant (PLT) PLT Bioenergy consisting of biogas, biomass and municipal solid waste is planned to have an installed capacity of 1,892 MW by 2015 and increase to 2,872 MW in 2019, with additional plans the construction of about 1131.4 MW over five years through the funding of the state budget of 18.6 MW and the private sector amounted to 1112.8 MW. Development of bioenergy PLT (Source: EBTKE)

4.  Leucaena –lamtoro  Acacia  Palm Oil Waste  Bamboo  Grass  Rubber three Proven Biomass fuel across Indonesia

5. Indonesia's Forestry Ministry to encourage the development of forest-based energy or energy forests. In 2019, the energy forest development is expected to reach 435 thousand hectares (ha),which is expected to provide fuel for power plants up to 40 thousand megawatts (mw) and will continue to be expanded to 800 thousand ha in 2025 INDONESIA'S FORESTRY MINISTRY POLICY Bamboo 15 T/ MW,a 50 to 70Ha loceanea 20 T/ MW,a 100 Ha

6. Proven Biomass Power Plant Technologies in Indonesia Three major Biomass power plant - Proven Technologies has been proven applied in Indonesia: 1.For small capacity <1 MW up to 2 MW Gasification system – Pyrolysis - More efficient - Less expensive 2. For Medium capacity 1 MW up to 5MW Boiler Binary cycle system – Full combustion - More efficient - More expensive - Live time is longer 3. For Medium up to bigger capacity Boiler steam cycle system – Full combustion 5 MW up to >100 MW - For small cap is Less efficient - Based cost - Live time is longer

7. Biomass power plant -Gasification system Process <1 MW up to 2 MW Reaction Zone at Gasifies

8. Biomass power plant -Gasification – Pyrolysis process Zona Reaksi Pada Gasifier

9. Biomass power plant -Gasification system Proses Diagram

10. Biomass power plant -Gasification system Bamboo Plantation Shredder Bamboo storage Gasifier Syngas Waste to be fertilizer Gas Engine and Generator Set Electricity Distribution Electricity

11. Biomass power plant 3D -Gasification system

12. Fuel Consumption  Biomass consumption of the gasifier is app. 15Tons/MWe electrical output –Bamboo  Biomass consumption of the gasifier is app. 20Tons/MWe electrical output –Wood Biomass power plant -Gasification system – Performances <1 MW up to 2 MW

13. Boiler with ORC (Organic Ranking Cycle) Biomass Power Plant Binary cycle -Medium capacity

14. Biomass power plant - Binary cycle system – Full combustion 1 MW up to 5MW Thermal Oil

15. MDF 2 x 10 MW Thermal Oil Hutrindo (Indonesia) Biomass power plant - Binary cycle system

16. FLOW CHART BIOMASS POWER PLANT BAMBOO PLANTATION STOCKER BOILER CONDENSING STEAM TURBINE SUBSTATION TURBO GENERATOR FEEDSTOCK Biomass power plant -Boiler steam system – Full combustion type For 5 MW up to >100 MW

17. New regulation on the purchase of electricity by PLN from biomass and biogas power projects (Minister of Energy and Mineral Resources Regulation No. 21 of 2016 – Reg 21/2016). These are the key features of the new regulation: ––Biomass and biogas power projects are to be awarded on the basis of a direct appointment process; ––Feed-in tariffs (FITs) available both for conventional IPP projects and projects which involve the sale of excess electricity to PLN; ––No more restriction on the capacity of biomass and biogas power projects that can be developed and benefit from the FITs; ––A standard power purchase agreement (PPA) to be issued by PLN and which will need to be signed within 30 days from award of the relevant project by MEMR. NEW REGULATION MEMR NO. 21 OF 2016.

18. Regulation 21/2016 contemplates a system by which biomass and biogas IPP projects are awarded to interested developers on the basis of a direct appointment and through a two-step process consisting of 1.1 Candidacy phase The candidacy phase includes (a) The submission to the Directorate General of NER at MEMR (EBTKE) of an application to become a Developer, (b) the verification of applications by EBTKE, and (c) The appointment as a Developer by the MEMR. (a) Application to become a Developer: The application has to be contain the following documents: (i) Profile of the applicant; (ii) Feasibility study which has been verified by PLN (within 30 working days from submission by the applicant) and which has to contain among others: (iii) A statement on the prioritization of the use of local goods and/or services; and (iv) Evidence of financial capability. Procedure of biomass and biogas power plants development (b) Verification of applications by EBTKE: EBTKE will then verify within 7 working days from the complete submission of the application. (c) Appointment of Developers: Where EBTKE approves an application, within 7 working days from receiving the recommendation from EBTKE. (d) Only Indonesian entities may become a Developer

19. 1.2 Development phase The following steps that need to be undertaken after the appointment as a Developer: (a) PPA signing: A power purchase agreement (PPA) must be signed with PLN within one month from the appointment as a Developer. The PPA shall have a term of 20 years from COD and can be extended. (b) Financial Close: A Developer must achieve financial close for a given project within 12 months from the execution of the relevant PPA. (c) IUPTL: After the above steps have been completed, the Developer has to apply to obtain an Electricity Supply Business License (Izin Usaha Penyediaan Tenaga Listrik or IUPTL (d) Report on Construction Progress: The Developer must submit a report to EBTKE on the construction progress of the project every 6 months from the date of the MEMR Approval Decree up to COD. (e) COD: COD must take place within 36 months from the execution of the PPA. If COD is not achieved within this timeframe, PLN will reduce the applicable FIT progressively and up to 8% depending on the duration of the delay, and if such delay is in excess Procedure of biomass and biogas power plants development

20. New Electricity Tariff

21. Case study :Typical financial Analysis  The Comparative of Electricity Tariff Tariff structure proposal consists of four payment element:  Capacity Charge :Component A (Capital Cost Recovery Payment)  Fixed O&M Charge :Component B (Fixed O&M Cost Recovery Payment)  Fuel Charge : Component C (Energy Payment)  Variable O&M Charge :Component D (Variable O&M Cost Recovery Payment)

22. TYPICAL FINANCIAL ANALYSIS BIOMASS PLANT 2 X 3,5 MW

24. Thank you