LIFE CYCLE COSTING AND EXTERNALITIES OF PALM BIODIESEL AND ALGAE BIODIESEL IN INDONESIA

arif dwi santoso

Abstract


The rapid depletion of current oil reserve will force Indonesia to explore new energy alternative sources such as renewable energy instead of fossil oil. The development of biofuel in Indonesia shows interesting trend which is dominate by palm oil, corn oil, jatropha and cassava. However, the application of microalgae for biofuel is still under development. Therefore, this paper aims to popularize the microalgal biomass as an alternative source for biodiesel. In order to gain the goal, Variable comparizon of the microalgae and palm biodiesel production was done by extended-LCA. Extended-LCA utilation is prefer to accommodate all variable of environmental commodities, so the potential of microalgae biomass which are renewable biomass, low in land use, and environmentally friendly can be promotted. Environmental commodities variable value was explored by willingness to pay (WTP) and referred from the calculation of software Environmental Priority Strategy (EPS) version 2000. The study showed that the composition of the cost biodiesel production was the production cost of biomass/oil palm fresh fruit bunches which reaches 51-62%. Extended-LCA analysis concluded that the addition of environmental variables affect the total increase in commodity production costs up to 14%. The profitability analysis shows that the microalgae biomass supply was more secure and sustainable than palm biomass due to the technical and non-technical constraints on the production of algae biomass is more easily while also it will lead in the mitigation of greenhouse gas (GHG) in the future.

Key wards: life cycle costing, extended-LCA, externality, palm  biodiesel, algae biodiesel


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