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Concept note for developing a waste-to-energy

pilot in Indonesia
Project on Pro-poor and sustainable solid waste management in
secondary cities and small towns in developing Asia
1. Introduction and Context
Since 2009, ESCAP, in partnership with Waste Concern, has been promoting a shift from end-of-thepipe to a waste to resource approach through the regional project on Pro-poor and sustainable
solid waste management in secondary cities and small towns. The project assists local governments
in establishing integrated resource recovery centres (IRRCs) and in developing and implementing citywide solid waste management strategies that are decentralized, pro-poor, low-carbon and financially
viable.

IRRCs are decentralized neighbourhood-based waste processing facilities that enable cities to turn
waste into resources through composting, recycling and bio digestion, thereby diverting municipal
solid waste from landfills or open dump sites. The approach promotes community participation in solid
waste management through the promotion of separation of waste at source and various educational
and awareness raising activities. IRRC with a capacity of between 2 and 5 tons a day have been
established in cities in Bangladesh, Cambodia, Pakistan, Sri Lanka and Viet Nam. So far, the IRRC
model has primarily focused on the recovery of recyclables and the production of compost. The
development of a waste-to-energy pilot will explore the potential for deriving value out of municipal
solid waste (MSW) by converting its organic component into energy through anaerobic digestion.

Research conducted by ESCAP in 2013 reviewed experiences related to the application of anaerobic
digestion to treat MSW in Asia-Pacific, highlighting challenges and opportunities, and assessing the
potential of countries in South-East and South-Asia of hosting a successful pilot project, as well as the
profitability of different waste-to-energy models. Based on the findings of this research and on
subsequent meetings with relevant stakeholders, Indonesia was found to be the most suitable location
for the pilot project, in light of existing policies and programmes on MSW management, extensive
experience in promoting community-based waste-to-resource approaches, and the availability of local
knowledge of anaerobic digestion technologies applied to MSW. The proposed pilot project is in line

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with the UNPDF 2011-2015 for Indonesia, and in particular it would support outcome 5 on climate
change and environment.

This document summarizes the main characteristics of the envisaged pilot project, including its
objectives, key design features and possible implementation arrangements. A more detailed project
concept note will be developed based on inputs from various stakeholders.

2. Project Concept and Objectives


The key objectives of the waste-to-energy pilot are as follows:

i) To demonstrate the viability financial, environmental and social of a decentralized,


community-based and pro-poor waste management model that has at its core the conversion
of the organic fraction of municipal solid waste into energy, and which is in support of national
policies;
ii)

To develop a multi-stakeholder partnership which can serve as a blueprint for further


replication of the model in other locations in Indonesia and other countries in Asia-Pacific.

At the initial stages of the project, the definition of the objectives, ambition and reach of the pilot
should be discussed and agreed among all partners involved. The table below summarizes the scope
and main characteristics of the planned project, which should be further detailed based on the views
and consultations conducted with stakeholders in Indonesia:

Waste-to-Energy Pilot Concept

Key design features

Technical and
Operational
Considerations

Location: preferentially a small city or secondary town in Indonesia. Proximity to


a source of waste generation with high organic content (such as a fruits and
vegetables market). Co-location with an existing facility such as a landfill gas
recovery site or a composting plant could also be considered;
Envisaged Capacity: 5 ton of source-separated organic waste per day, working
5-6 days per week;
Technology: anaerobic digestion of the organic fraction of municipal solid
waste;
Other relevant aspects:
o The pilot should be holistically seen in the context of the host MSW system
and that it can be in line with the IRRC model, including aspects such as
the separation of waste at source, recovery and storage of recyclables,
improved waste collection services to the community, etc.
o The project may be associated with a composting component, although
additional resources may need to be leveraged for its development.
Preference for a technology or technology provider that is locally available (i.e. in
the country or in the region) and that can be easily adapted to the local context;
Involvement of a national research institute or university in the initiative, in order
to support and oversee the technical aspects related to the design and operation
of the facility;
Preferably, the technology provider should be willing to assume part of the
technical risks of the solution;

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Possibility of leveraging elements of a waste-to-energy model already operating


in Indonesia (e.g. Waste Refinery Center, Gadjah Mada University, Yogyakarta);

The access to source segregated organic waste will be a key component of the
project.

ESCAPs indicative budget for the project: 200,000 USD

The financial sustainability of the model is one of the pillars of this pilot project;

Different income streams to be explored, including the following:


o Electricity from biogas production;
o Digestate to be used directly as a fertilizer (liquid or solid), or as a
substrate for further composting;
o Tipping fee from municipality or waste collection fee;
o Sale of other by-products or other resources recovered, including
recyclables;
o Possibilities for carbon financing.
In-kind contributions expected from national and municipal governments, such
as in the allocation of land free of cost, delivery of waste to the facility at no cost,
access to electricity and water supply, etc.

Financing Model
and partnership
arrangements

A tipping fee from the local government should be ensured in order to guarantee
the economic viability of the project.

Table 1 Main features of the envisaged waste-to-energy pilot.

The development of the project will holistically take into account five pillars institutional,
political/policy, social, technical and economic/financial as illustrated in figure 1 below:

Institutional

Develop a multi-stakeholder
partnership model
Enhance local governance on
MSW management issues

Social

Political/Policy
Support the
implementation of
waste management
policies of Indonesia
Extract lessons
learned and examine
potential for replication
of the model

Waste-toEnergy Pilot

Technical

Improved livelihoods for the


urban poor
Community participation in
MSW management
Education and awareness
raising on the way waste is
seen and treated

Economic/Financial

Demonstrate AD approach and


its viability on a cost-effective
and easy to replicate manner
Leverage and promote local
know-how

Establish a low-cost and


financially sustainable
MSW management model
Savings to local
governments on MSW
management

Figure 1 Five pillars of the waste-to-energy project.

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3. Implementation Plan
The project is planned to be implemented in four phases, in addition to two other phases that will be
conducted continuously throughout the duration of the project, as indicated below:

Tentative
Timeframe

Phase / Activity
Phase I Project kick-off and preparatory work
Identification and engagement of relevant stakeholders
Shortlisting of cities through the organization of a national workshop

September to
December 2014

Phase II Project definition and establishment of partnership arrangements

Conducting of baseline surveys and fact finding missions to shortlisted cities


Selection of city to host the project
Obtaining of permits and preparation of necessary studies to implement the project
Plant design, procurement and assignment of contract for construction

Phase III Construction of the Plant

September 2014 to
June 2015

July to September
2015

The plant is constructed on time and within budget


Phase IV Operation of the Plant
The plant is commissioned and operated on a daily basis
Implementation of a programme for the separation of waste at source
Documentation and Dissemination Strategy

From October
onwards

Ongoing

Project Monitoring and Oversight

Ongoing

Establishment and operation of a steering committee or project management board


Table 2 Planned phases for developing the waste-to-energy pilot.

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2015