January 25, 2006 Tokyo Electric Power Company (TEPCO) Feasibility Study Using Empty Fruit Bunch as Power Plant in West Kalimantan as CDM scheme January 25, 2006 Tokyo Electric Power Company (TEPCO)

Site location : West Kalimantan in Indonesia Project Site Site location : West Kalimantan in Indonesia

Project Site in West Kalimantan

EFB Transport

Project purpose Promoting utilization of CDM based on TEPCO’s CO2 emissions reduction policy. Contribution for Indonesian electric power shortage.

Background (1) BPPT(Agency for the Assessment and Application of Technology) introduced PTPN13(PT.Perkebunan Nusantara) to us. PTPN13 was considering boiler refurbishment and studying new project.

Background (2) This study was executed in accordance with a commission by NEDO.

Outline of F/S Install a Power Plant using EFB(Empty Fruit Bunch) and CH4(Methane) gas from Palm Oil Plantation F/S Participant : TEPCO, PTPN13 , BPPT , IEEJ

System Description Boiler for EFB & CH4 fuel Steam Turbine and Generator EFB Pretreatment System CH4 Collecting System Grid connection to PLN 20kV

System Description (schematic view)

Specification of Steam Turbine

Specification of Boiler

Project scheme

Economic Term

Barriers for investment at present Low IRR from High initial cost Palm waste fired power generation project can not have cost advantage of scale. Unsure in PPA contract with PLN. No incentive in the range of over 1 MW renewable power project. No regulation in the contract period & tariff mechanism.

Countermeasures to overcome barriers (1) Low IRR from High initial cost Utilizing NEDO subsidy and reduction of initial cost. To make a high efficiency of project implementation and cost reduction, Considering the scheme that we seek local Japanese developer and then we may concentrate to contribute on technical advice mainly.

Countermeasures to overcome barriers (2) Unsure in PPA contract with PLN. Several model projects by Japanese government Making Road Map (Such as making PPA format)

After F/S and Future Plan After this F/S, PTPN13 requested us to give a developed study, and we gave the result. Now, PTPN 13 is studying based on this result. But not yet conclude. We are seeking local Japanese developer and investor. But not yet because of above reason. We are seeking other possibility to help the progress of this project with adding valued option.

Summary We are still placing this project as Typical biomass CDM project in Indonesia. We may request Indonesian government to establish and enforce regulation which gives incentives up to 10 MW in renewable power supply. We propose several CDM model projects in each biomass sector by Japanese government. Besides, we propose the engagement of MOU for promoting CDM between Japanese government and Indonesian government.

Contact us Overseas Project Group, Thermal Power Department, Tokyo Electric Power Company hasegawa.yohei@tepco.co.jp Kyoto Mechanism Promotion Division Energy and Environment Technology Center, NEDO cdmji@nedo.co.jp