Indonesia's palm oil industry generates an estimated 125 million tonnes of mill effluent (POME) annually, representing a largely untapped biogas resource. According to the Palm Oil Agribusiness Strategic Policy Institute (PASPI), the potential biogas production from this feedstock reaches 3.6 billion cubic metres per year — yet current utilisation stands at only around 15% of available capacity.
PASPI Executive Director Tungkot Sipayung noted that each tonne of POME can yield approximately 28.8 cubic metres of biogas through methane capture technology.
With Indonesia operating 16.8 million hectares of oil palm plantations producing 250 million tonnes of fresh fruit bunches annually, the scale of underutilised feedstock is substantial.
The economic case for deployment is clear. Beyond biogas production for mill operations and electricity generation, the gas can be purified into bio-compressed natural gas (bio-CNG) for vehicle fuel.
Processing POME reduces greenhouse gas emissions by an estimated 1,131 tonnes of CO₂-equivalent per month per facility, according to National Research and Innovation Agency (BRIN) researcher Prof. Dr. Erma Yulihastin. POME management also creates employment across construction, operation and maintenance of facilities.
Yet deployment remains sporadic. Sipayung attributed the gap to missing policy mechanisms and called for three government interventions: carbon trading frameworks specific to POME methane capture, mandatory methane capture obligations at all mills backed by investment incentives, and mandatory blending of biogas into fossil gas energy supplies.
'If these three policies were implemented, I believe all palm oil mills would invest in methane capture,' Sipayung said.
The government's Palm Research Grant programme has begun funding POME biogas technology development, but broader policy certainty remains absent. Until regulatory frameworks create binding obligations and financial incentives, Indonesia's biogas resource will continue to be flared or left unutilised.
Indonesia’s palm oil waste ‘could generate 3.6 billion cubic metres of biogas annually’
