GREEN INDUSTRY SCHEME IMPLEMENTATION IN INDONESIA · PDF fileGREEN INDUSTRY SCHEME...

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GREEN INDUSTRY SCHEME IMPLEMENTATION IN INDONESIA By: Lintong Sopandi Hutahaean Head of R & D Center for Green Industry and Environment Ministry of Industry, Republic of Indonesia 1

Transcript of GREEN INDUSTRY SCHEME IMPLEMENTATION IN INDONESIA · PDF fileGREEN INDUSTRY SCHEME...

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GREEN INDUSTRY SCHEME IMPLEMENTATION

IN INDONESIA

By: Lintong Sopandi Hutahaean

Head of R & D Center for Green Industry and Environment

Ministry of Industry, Republic of Indonesia

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Location: 6

°08' N and 11

°15' S, and between 94

°45' E and 141

°05‘ E

Total Area: 5.193.250 sq km

Expanse Area: 3,977 miles

Number of Registered Island: 13,466

Population: 253,609,643

Ethnic Group: 1,340

BRIEF FACTS OF INDONESIA

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RESOURCES METABOLISM OF INDONESIA

Source:

World Bank, 2015; UNEP, 2011;

Statistic Indonesia, 2016

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INDUSTRIAL SECTOR ROLE IN NATIONAL ECONOMIC

INDICATORS MEDIUM TERM PROJECTION

2015 2016 2017 2018 2019

GDP Growth (%) 5.8 6.6 7.1 7.5 8

Manufacturing Industry Growth (%) 6.1 6.9 7.4 8.1 8.6

Manufacturing Industry Contribution to total GDP (%) 20.8 21 21.1 21.3 21.3

Manufacturing Industry Export (Billion US$) 156.7 172.2 192.8 219.2 250.5

Source: National Medium-Term Development Plan 2015 - 2019 4

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TOTAL FINAL CONSUMPTION (TFC) OF ENERGY BY SECTOR

Source: IEA. 2015. Energy Balances of Non-OECD Countries, OECD/IEA. Paris

GHGs EMISSION AND TFC BY SECTOR IN INDONESIA

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ACHIEVING GREEN GROWTH THROUGH DECOUPLING

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GREEN INDUSTRY DEVELOPMENT

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GREEN INDUSTRY MILESTONE

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Definition:

Green Industry shall be any Industry with a production process which places priority on efficiency and effectiveness in the

sustainable use of resources, to enable harmonization between Industrial development and the preservation of environmental

functions as well as to grant benefits to the community. .

(Article 1, Number 3)

Green Industry as one of national industry goal

industry is organized with the goal of achieving self-sustaining,

competitive and advanced industry, as well as green industry

(Article 3 Point C)

GREEN INDUSTRY POLICY IN LAW NUMBER 3 OF 2014

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OLD

AN

D O

BS

OLE

TE

MA

CH

INE

RY

/ T

EC

HN

OLO

GY

High Losses:

- Energy Intensity >>

- Water Intensity >>

- Input Material >>

In-efficient natural resources

consumption

Low Productivity

High Waste Generation

EC

O-F

RIE

ND

LY/

LOW

CA

RB

ON

T

EC

HN

OLO

GY

New Machinery/ Equipment

Machinery/ Equipment

Modification

Low Losses:

- Energy Intensity <<

- Water Intensity <<

- Input Material <<

Natural Resources Efficiency

High Productivity

Zero Waste

Cost Recovery

GREEN

INVESTMENT

PARADIGM

TRANSFORMATION

WHY TRANSFORMS TO GREEN INDUSTRY

CONVENTIONAL MANUFACTURING SYSTEM GREEN INDUSTRY MANUFACTURING SYSTEM

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IMPROVEMENT THROUGH GREEN INDUSTRY

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IMPLENTING GREEN INDUSTRY PRINCIPLES

EFFICIENCY IMPROVEMENT: LESS MATERIAL, ENERGI, MORE PRODUKTIVE, REDUCED REJECT

PRODUCTS, LESS WASTE

COMPETITIVE: SAVING, MARKET ACCEPTANCE

IMPROVEMENT OPPORTUNITIES

GREEN INVESTMENT: EQUIPMENT, TRAINING

SUPPORTING

R & D, TECHNICAL SERVICE (WASTE MANAGEMENT, ENERGY MANAGEMENT, WATER MANAGEMENT)

HIGH EFFICIENT MACHINES, EQUIPMENTS

ESCO

POLICY/REGULATION

• STANDARD

• INCENTIVE

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Formulation of Green Industry Standard

PREPARATION DEVELOPMENT ACCELERATION SUSTAINABLE

Formation of

Certification Body

Certification on 8

Focused Sector Certification for other industries

Formulation of Competency Standard

Formation of

Accrediation Body Accreditation of Green Industry Certification Body

Formulation of regulation framework for Green

Industry Standard Provision

Formulation of regulation framework for

Competency Standard

Formulation of regulation

framework for Certification

Body Establishment

GR

EE

N I

ND

US

TR

Y I

NF

RA

ST

RU

CT

UR

E

Formulation of regulation

framework for Accreditation

Body Establishment

Development of National

Green Industry

Information System

Green Industry National Promotion

(Green Factory, Green Product, Green Investment, etc.)

2011 2016 2021 2026 2031

GREEN INDUSTRY MASTER PLAN (UNOFFICIAL) 12

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Formulation of Priority

R&D for Green Industry

PREPARATION DEVELOPMENT ACCELERATION SUSTAINABLE

R & D Development in Ministry of Industry’s R & D Units to support Green Industry Policy

Formulation of

Priority Training for

Green Industry

Development of supportive training of Green Industry Principle and Implementation

Machinery and technology

Inventory

Formulation of industrial

sector revitalization priority

Technological need for Green Industry

INS

TIT

UT

ION

AL

CA

PA

CIT

Y O

F G

RE

EN

IN

DU

ST

RY

Formulation of

technology transfer priority

Formulation of Technology Transfer

Policy for Green Industry

2011 2016 2021 2026 2031

Industrial revitalization towards

Green Industry

Technology Transfer 13

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Incentive Need Analysis

for Green Industry

PREPARATION DEVELOPMENT ACCELERATION SUSTAINABLE

Formulation of

incentive priority

Formulation of

incentive policy

Implementation of Green Industry Incentive

(Fiscal, non fiscal, monetary, license, market policy

and etc.)

Dicentive need as

supportive component

Formulation of Dicentive Policy

Implementation of Dicentive as the supportive tool

for Green Industry Implementation

Funding Analysis for Green Industry Development

GR

EE

N I

ND

US

TR

Y F

AC

ILIT

AT

ION

Identification of Funding Sources and Mechanism

Funding for Green Industry

Development

2011 2016 2021 2026 2031

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GREEN INDUSTRY AWARD

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GREEN INDUSTRY AWARD

Ministry of Industry Regulation No. 18/M-

IND/PER/3/2016 regards Green Industry Award

Green Industry Award is given to industrial

company who have implemented green

industry principle in their production process

LEGAL BASIS

Encourage and motivate industrial companies to

implement the principles of green industries OBJECTIVE

1. Production Process (70%)

2. Waste and Emission Management (20%)

3. Business management (10%)

EVALUATION

ASPECTS

Since 2010 to 2015 the award has been given to

365 green industry companies RESULT

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PRODUCTION PROCESS (70%)

- Production efficiency program; - Material inputs, energy, and water consumption; - Technological Innovation; - Human Resources competencies; - Safety Health and Environment.

WASTE AND EMISSION MANAGEMENT (20%)

- CO2e emission reduction program; - Environmental quality standards compliance; - Waste and emissions management and facilities

BUSINESS MANAGEMENT (10%)

- Certification; - CSR; - Awards; - The health of employees.

EVALUATION ASPECTS

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GREEN INDUSTRY AWARD

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CEMENT INDUSTRY

Raw Material Usage efficiency

( 1.70%)

Raw Material Subtitution Rate (10.11%)

Energy Efficiency

(6.15%)

Alternative Energy Rate (5.79%)

Water Ratio Reduction

(10.25%)

GREEN INDUSTRY AWARD IMPACT

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GREEN INDUSTRY STANDARD

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GREEN INDUSTRY STANDARD

• Green Industry standard (GIS) is classified based on Business Group Classification Standard of

Indonesia (KBLI) in 5 digits

• 8 standards has been ratified by the Minister of Industry i.e.. Ceramic Tiles; Textile on Dyeing,

Printing and Finishing; Portland Cement; Pulp and Integrated Pulp; Single Macro Nutrients

Fertilizer; Milk Powder, Crumb Rubber; and Ribbed Smoked Sheet Rubber (RSS).

• 4 standards are on finalizing stage i.e. white sugar; Basic oleo chemicals, tanneries and glass

sheet

• Currently Ministry of Industry is preparing the establishment of the Green Industry

Certification Body (GICB) and Green Industry Authorization Committee (GIAC)

• GIS will initially be voluntary, but will be enforced compulsory with some terms and

conditions.

• Industrial company who can comply with the GIS evaluation aspects and criteria will get a

certificate of Green Industry and the right to use Green Industry Logo

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GREEN INDUSTRY

STANDARD

GREEN INDUSTRY STANDARD

ON PRODUCT LIFE CYCLE

Green Industry Standard

specifically regulates on

Industrial Process, starts from

material extraction to packaging

station

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GR

EEN

IND

USTR

Y S

TAND

AR

D

EVALU

ATIO

N A

SPEC

TS

RAW MATERIAL AND AUXILIARIES

ORIGIN

SPESIFICATION

HANDLING

RATIO

ENERGY

ELECTRICITY

HEAT

RENEWABLE ENERGY

WATER CONSUMPTION

RECYCLE RATE

PRODUCTION PROCESS OEE

REJECT RATE

PRODUCT SPESIFICATION

PACKAGING

WASTE & EMISSION MANAGEMENT

WASTE MANAGEMENT

GHGs EMISSION

BUSINESS MANAGEMENT

GI POLICY

GI PROGRAM

MONEV 23

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Validity Expired

(Re – Certificationi)

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GICB assigns the Green

Industry Auditor to the

company

3 The company apply the green

industry certification application to

Green Industry Certification Body

(GICB) cc Green Industry

Authorization Committee (GIAC)

1

(GICB) check the completeness

and validity of the documents as

well as the adequacy of the

auditee

2

GICB reviewing and

evaluating audit results

4

Issuance of Green Industry

Certificate

(Valid for 3 years period)

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GREEN INDUSTRY CERTIFICATION SCHEME

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GREEN INDUSTRY LOGO

The Logo is formalized through Ministry of Industry Decree No. 448/M-IND/KEP/10/2015 regards

Green Industry logo

Industrial companies who have been awarded Green Industry Certificate is entitled to use the Green

Industry logo

Green Industry logo is expected to enhance the product’s brand value because the logo is a guarantee mark from the government that stated the company has implemented sustainable production process

(green industry) 25

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