We can do it: Climate-smart and Business-smart with methane capture

ANJ Group

7. Affordable and Clean Energy 13. Climate Action

Overview

ANJ Group is a palm oil company. The group engages in the production and sale of crude palm oil, palm kernel, palm kernel oil, and others. It is inevitable for palm oil companies to emit methane, which is one of Green House Gases, from palm oil mill effluent. In order to reduce Green House Gases emissions, the group has captured the methane and generated electricity by using the methane in one of its palm plantations since 2013. It will be extended to its other palm plantations.

Author

HYUNSUK KIM

HYUNSUK KIM

School

IPMI International Business School

IPMI International Business School

Professor

Amelia Naim Indrajaya

Amelia Naim Indrajaya

Innovation

ANJ group began capturing methane from palm oil mill effluent (“POME”) and generating electricity by using the methane since 2013. In order to generate electricity power, ANJ group has operated a 1.8MW capacity biogas power plant at its Belitung Island Plantation through its subsidiary. It has supplied the electricity to State Electricity Company (“PLN”) as an Independent Power Producer. It is the first independent power producer (“IPP”) in Indonesia to operate and sell electricity from a palm-oil-mill waste biogas power plant .


We can do it: Climate-smart and Business-smart with methane capture

Inspiration

ANJ group has placed a greater emphasis on ESG management and sustainable development. ANJ group has set its target as contributing toward slowing the progression of global warming climate change. In order to reduce Green House Gases (“GHG”) emissions as a part of its contribution, it began capturing methane from Palm Oil Mill Effluent (POME, the palm oil mill liquid waste) and generating electricity from the methane that is captured from the anaerobic process of POME.

Lucas Kurniawan, who is the president director, spoke “As an industry, agribusiness is highly dependent on finite environmental resources. Our approach to sustainable development is called Responsible Development and ensures that we meet the needs of the present without compromising the needs of future generations. At ANJ, Responsible Development is founded on three pillars, People, Planet, and prosperity. Together these pillars form our triple bottom line for delivering sustainable outcomes for people, the environment, and the economy.

Our recent performance amid challenging times is strong evidence that a sustainable business model, built on the triple bottom line, creates a more profitable and successful business.

As we implement initiatives to mitigate climate change risk and meet emission reduction targets, it has become increasingly evident to us that climate-smart is also business-smart and that operating sustainably is commercially viable. Our biogas power plant in Belitung Island is a good example. Seeing the potential of methane capture in reducing methane emissions while also generating renewable energy, we plan to scale up to other locations by having at least one additional methane capture facility by 2023.”


Overall impact

This biogas power generation is one of business segments of ANJ Group. With this innovation, renewable energy sourced electricity has been provided to around 2,000 households, and GHG emission has been reduced.

Business benefit

ANJ Group’s electricity generation and sales were 9,400,660 kWh in 2020 and 9,402,197 kWh in 2021. The revenue from electricity sales and profit before tax in 2021 was USD 0.6 million and USD 0.1 million, respectively.

ANJ Group also consumes the electricity generated from methane. The consumption of electricity was 3,488 kWh in 2021. With this consumption, ANJ Group can reduce the usage of fossil fuels, such as diesel and gasoline.


Social and environmental benefit

With this innovation, the ANJ group captured 7,608 tons of methane in 2021. Many palm oil companies in Indonesia, such as Golden Agri, Makmur Group, and others, implemented or are planning to implement methane capture and electricity generation project in their palm plantation. As many companies participate in this innovation, it is expected that GHG emissions from the palm industry can be reduced further.


Interview

Lucas Kurniawan, President Director

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ANJ Group

ANJ Group

Various, Belitung Island, ID

Business Website: http://www.anj-group.com

Year Founded: 1993

Number of Employees: 5001 to 10000

ANJ Group is in the palm industry and engages in producing and selling crude palm oil, palm kernel, and others. The group has plantations in South Sumatra, West Kalimantan, and others.