In this presentation, CIFOR scientist Ahmad Dermawan discusses Indonesia’s plan for bioenergy development and the opportunities and challenges inherent in the recent interest in wood pellets from South Korea and China. In developing countries, he argues, the challenge is not (only) on technological issues or production of bioenergy, but also on social and governance issues. Ahmad gave this presentation as part of the ‘Feedstock from wood and forestry and conversion technology’ session at the second Annual World Congress of Bioenergy: Renewable Energy for Sustainability, held in Xi’an, China on 25–28 April 2012.

1. The prospects and challenges
for wood fiber bioenergy
development in Indonesia
Ahmad Dermawan and Krystof Obidzinski
BIT’s 2nd Annual World Congress of Bioenergy – 2012
Xi’an, 25-28 April 2012
THINKING beyond the canopy

2. Structure
About CIFOR
Forest resources in Indonesia
Wood-based energy in Indonesia
Opportunities
Challenges
Implications
THINKING beyond the canopy

3. Center for International
Forestry Research
Established in 1993
A “center without walls”: 200 staff globally, with extensive
network of partners
Global mandate, with focus on tropical forests
Headquartered in Bogor, Indonesia
2 Regional Offices, 7 Project offices, 37 country sites
THINKING beyond the canopy

4. Energy Mix in Indonesia
THINKING beyond the canopy

5. Indonesia is a forest-
forest-
rich country…
…but the forest is declining
• About 134 million ha forest estate
• Only 91 million ha forest cover
• Papua is where much forest cover left
THINKING beyond the canopy

6. Shift in log sources: from natural
forests to timber plantations
40,000,000
30,000,000
Log production (m3)
20,000,000
10,000,000
0
1994/95 1995/96 1996/97 1997/98 1998/99 1999/00 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Natural Forests Land Clearing Timber Plantations Others
THINKING beyond the canopy

7. Area (ha)
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
Smallholders
1986
1987
SOE
1988
1989
1990
Private
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
THINKING beyond the canopy
2006
2007
Oil palm expansion
2008
2009
2010

8. Increasing demand
for pulp and paper
8,000,000
7,000,000
6,000,000
5,000,000
Pulp production (m3)
4,000,000
3,000,000
2,000,000
1,000,000
0
1997/1998 1998/1999 1999/2000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
THINKING beyond the canopy

9. Wood-
Wood-based energy in Indonesia
Recent interests in wood pellets due to demand from
abroad
New investments coming in, notably from South Korea
China is exploring the opportunities
Land has been allocated for timber plantations for wood
pellets: Papua, Kalimantan, Central Java
THINKING beyond the canopy

10. Opportunities
Potentially large areas available for new plantations
• Approximately 13 million ha of land for biofuels
Government support, esp. in “food and energy zone”
• Lowered or exemption of taxes
• Fast tracked land acquisition
• Concession rights valid for 60 years, extendable to 90
years
• Visas and immigration assistance
THINKING beyond the canopy

11. Challenges
Decentralization complicates licensing and dealing on
administration matters
Although available land is large, it is generally dispersed
Land tenure system is complex
Demand for pulp and paper is still high and more
profitable
Oil is still heavily subsidized in Indonesia
THINKING beyond the canopy

12. Implications
Social issues is as important as technical and economic
issues.
Getting government buy-in is important
Get the processes for land acquisition and transfer of
land compensation funds sorted out in a clear and
transparent manner
Be prepared for negotiate legally binding acquisition
agreements and employment guarantees with local
communities
THINKING beyond the canopy

13. www.cifor.org
THINKING beyond the canopy