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A Techno-Economic Evaluation of Municipal Solid Waste (MSW) Conversion to Energy in Indonesia

Author

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  • Muhammad Mufti Azis

    (Department of Chemical Engineering, Faculty of Engineering, Universitas Gadjah Mada, Yogyakarta 55281, Indonesia)

  • Jonas Kristanto

    (Department of Chemical Engineering, Faculty of Engineering, Universitas Gadjah Mada, Yogyakarta 55281, Indonesia)

  • Chandra Wahyu Purnomo

    (Department of Chemical Engineering, Faculty of Engineering, Universitas Gadjah Mada, Yogyakarta 55281, Indonesia
    Agro-Technology Innovation Center, Universitas Gadjah Mada, Kalitirto, Berbah, Sleman, Yogyakarta 55573, Indonesia)

Abstract

Municipal solid waste (MSW) processing is still problematic in Indonesia. From the hierarchy of waste management, it is clear that energy recovery from waste could be an option after prevention and the 5R (rethink, refuse, reduce, reuse, recycle) processes. The Presidential Regulation No 35/2018 mandated the acceleration of waste-to-energy (WtE) plant adoption in Indonesia. The present study aimed to demonstrate a techno-economic evaluation of a commercial WtE plant in Indonesia by processing 1000 tons of waste/day to produce ca. 19.7 MW of electricity. The WtE electricity price is set at USD 13.35 cent/kWh, which is already higher than the average household price at USD 9.76 cent/kWh. The capital investment is estimated at USD 102.2 million. The annual operational cost is estimated at USD 12.1 million and the annual revenue at USD 41.6 million. At this value, the internal rate of return (IRR) for the WtE plant is 25.32% with a payout time (PoT) of 3.47 years. In addition, this study also takes into account electricity price sales, tipping fee, and pretreatment cost of waste. The result of a sensitivity analysis showed that the electricity price was the most sensitive factor. This study reveals that it is important to maintain a regulated electricity price to ensure the sustainability of the WtE plant in Indonesia.

Suggested Citation

  • Muhammad Mufti Azis & Jonas Kristanto & Chandra Wahyu Purnomo, 2021. "A Techno-Economic Evaluation of Municipal Solid Waste (MSW) Conversion to Energy in Indonesia," Sustainability, MDPI, vol. 13(13), pages 1-10, June.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:13:p:7232-:d:584034
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    References listed on IDEAS

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    2. Santiago Alzate-Arias & Álvaro Jaramillo-Duque & Fernando Villada & Bonie Restrepo-Cuestas, 2018. "Assessment of Government Incentives for Energy from Waste in Colombia," Sustainability, MDPI, vol. 10(4), pages 1-16, April.
    3. Tribe, M. A. & Alpine, R. L. W., 1986. "Scale economies and the "0.6 rule"," Engineering Costs and Production Economics, Elsevier, vol. 10(4), pages 271-278, March.
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    Cited by:

    1. Guoxian Cao & Chaoyang Guo & Hezhong Li, 2022. "Risk Analysis of Public–Private Partnership Waste-to-Energy Incineration Projects from the Perspective of Rural Revitalization," Sustainability, MDPI, vol. 14(13), pages 1-19, July.
    2. Budhijanto & Bima Prasetya Pancasakti, 2024. "Evaluating the Potential of Hydrogen Production from Agricultural Waste in Indonesia: A ComparativeTechno-economic Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 14(2), pages 618-623, March.

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