Techno-economic and greenhouse gas savings assessment of decentralized biomass gasification for electrifying the rural areas of Indonesia

This study explored the feasibility of decentralized gasification of oil palm biomass in Indonesia to relieve its over-dependence on fossil fuel-based power generation and facilitate the electrification of its rural areas. The techno-feasibility of the gasification of oil palm biomass was first evaluated by reviewing existing literature. Subsequently, two scenarios (V1 and V2, and M1 and M2) were proposed regarding the use cases of the village and mill, respectively. The capacity of the gasification systems in the V1 and M1 scenarios are determined by the total amount of oil palm biomass available in the village and mill, respectively. The capacity of the gasification systems in the V2 and M2 scenarios is determined by the respective electricity demand of the village and mill. The global warming impact and economic feasibility (net present value (NPV) and levelized cost of electricity (LCOE)) of the proposed systems were compared with that of the current practices (diesel generator for the village use case and biomass boiler combustion for the mill use case) using life cycle assessment (LCA) and cost-benefit analysis (CBA). Under the current daily demand per household (0.4 kWh), deploying the V2 system in 104 villages with 500 households each could save up to 17.9 thousand tons of CO2-eq per year compared to the current diesel-based practice. If the electricity could be fed into the national grid, the M1 system with 100% capacity factor could provide yearly GHG emissions mitigation of 5.8 × 104 ton CO2-eq, relative to the current boiler combustion-based reference scenario. M1 had a positive mean NPV if the electricity could be fed into the national grid, while M2 had a positive mean NPV at the biochar price of 500 USD/ton. Under the current electricity tariff (ET) (0.11 kWh) and the biochar price of 2650 USD/ton, daily household demands of 2 and 1.8 kWh were required to reach the break-even point of the mean NPV for the V2 system for the cases of 300 and 500 households, respectively. The average LCOE of V2 is approximately one-fourth that of the reference scenario, while the average LCOE of V1 is larger than that of the reference scenario. The average LCOE of M1 decreased to around 0.06 USD/kWh for the case of a 100% capacity factor. Sensitivity analysis showed that the capital cost of gasification system and its overall electrical efficiency had the most significant effects on the NPV. Finally, practical system deployment was discussed, with consideration of policy formulation and fiscal incentives.