Global Environment Centre Foundation (GEC)
| Contact | Japanese |
 Home > Activities > CDM/JI Feasibility Study (FS) Programme

Reports of CDM/JI Feasibility Studies: FY2008

Title of Feasibility Study (FS)Palm Oil Mill Effluent (POME) Treatment Co-benefits CDM in Muar, Malaysia
FYFY 2008
Main Implementing EntityTokyo Electric Power Environmental Engineering Co., Inc.
FS Partner(s)Kilang Kelapa Sawit Bukit Pasir SDN. BHD., and Kansai Corporation
Location of Project ActivityMalaysia (Muar, Johor)
Summary of FS ReportPDF (1.0MB)
Description of Project ActivityThe feasibility study is concerned with the Project which will be carried out at the project site where is the BUKIT PASIR palm oil mill operated by the counter party KILANG KELAPA SAWIT BUKIT PASIR SDN. BHD. (Muar, Johor, Malaysia). The study is intended to materialize the CDM project aims at avoidance of methane gas emissions which is now generated by anaerobic treatment process in the palm oil mill, by means of replacing the current anaerobic open-lagoon system with a new POME treatment technology using a decanter and flocculant material.
The organic materials solidified by the new treatment technology are desiccated by drying equipment using the waste heat (excess steam) of boilers in the Mill and then reused for a supplementary fuel of the boilers.
In the baseline, in exchange for a significant drop in COD in the wastewater, a large volume of methane gas is released to the atmosphere due to the anaerobic lagoon treatment.
However in the Project, this will be replaced by an approach which minimizes any anaerobic activity. In the final stage of treatment, flocculent material will allow for a much fuller treatment of the wastewater. The wastewater thus treated would be of sufficient quality for recycling within the Mill, and would of course meet the discharge standards of COD, BOD and TS for release into nearby waterways.
The implementation of the Project not only contributes to restraining greenhouse gas generation but also is expected to be a co-benefits CDM project with such positive effects as the reduction in offensive odor on the surrounding environment and the environmental quality improvement through the improvement of water quality of waterways where the treated wastewater is finally discharged.
The emission reduction (ERy) of greenhouse gas has been calculated on the assumption that the inlet COD concentration is 78,000mg/l and the annual inlet effluent is about 145,000Mt. In the result an average of the ERy during the Project period is approximately 35,000tCO2/year.
Targeted GHGCH4
Category of Project ActivityWaste Management
CDM/JICDM
Duration of Project Activity/ Crediting PeriodSeptember 2010 – September 2019 (10 years)
Baseline Scenario (including Methodology to be applied)From the viewpoint of the small-scale CDM project, the existing applications of AMS-III.I (Version 07) and AMS-III.Y (Version 01), and a application of a new small-scale methodology (under SSC category III) may be appropriate as baseline scenario.
(a) "Avoidance of methane production in wastewater treatment through replacement of anaerobic systems by aerobic systems" (AMS-III.I (Version 07))
(b) "Methane avoidance through separation of solids from wastewater or manure treatment systems" (AMS-III.Y (Version 01))
(c) "Methane avoidance through chemical treatment of industrial wastewater" (new small-scale methodology).
Demonstration of AdditionalityTo demonstrate the additionality of the Project, the following possible barriers are considered.
  • Investment barrier: The Project has no source of income except the income from the CERs. Without CDM application, the Project will not be implemented. In case the Project will not be implemented, the POME treatment by existing anaerobic lagoon system will carry on.
  • Technological barrier: The technology employed in the Project is in patent pending status and there is no case example of installing the technology in Malaysia. Without CDM application, the Project will not be implemented.
  • Prevailing practice barrier: The technology employed in the Project using decanters is not a common practice in Malaysia, due to the high-cost of installing and maintaining decanters. Without CDM application, the Project will not be implemented.
Therefore, the additionality of the proposed project is demonstrated.
Estimation of GHG Emission Reductions35,038tCO2/yr; 350,380tCO2/10yrs.
Monitoring Plan (including Methodology to be applied)The existing applications of AMS-III.I (Version 07) and AMS-III.Y (Version 01), and a application of a new small-scale methodology (under SSC category III) may also be appropriate as methodology as well as the baseline scenario.
(a) "Avoidance of methane production in wastewater treatment through replacement of anaerobic systems by aerobic systems" (AMS-III.I (Version 07))
(b) "Methane avoidance through separation of solids from wastewater or manure treatment systems" (AMS-III.Y (Version 01))
(c) "Methane avoidance through chemical treatment of industrial wastewater" (new small-scale methodology)
Environmental Impact AnalysisThe implementation of the Project allows for the prevention of greenhouse gas emission, the neutralization of offensive odor on the surrounding environment, the water quality improvement of the waterways finally released, and other positive effects on the environment
With regard to the Environmental Impact Assessment (EIA) on the designated projects implemented in the Johor, Malaysia, the Department of Environment Johor (DOE) determines the necessity of the EIA according to the Environmental Quality (Prescribed Activities) (Environmental Impact Assessment) Order 1987.
In case of the Project, in consequence of the hearing interview with DOE, the implementation of full EIA is not necessary because there is no designated matter prescribed in the Order.
Issues and Tasks for Project MaterialisationThe facilities and equipments used in the Project will be procured internationally. The initial investment is about 110 million yen. Employing the services of local engineering companies is supposed for the construction.
It is assumed those of both; that the CERs price is 11.4EURO/tCO2 referring to the selling price in the primary market for emission trading, and that the income (CERs credits) is calculated on the basis of that the emission amount of 35,038tCO2/year equivalent to the estimated reduction by the Project will be issued and traded from 2011 and continuously salable in some way from 2013 or later. Then a provisional IRR has been calculated on conditions of preinterest and pretax. The IRR for 7 years is minus 8.3% and the payout time is 10 years. As the issues to be addressed in the future, the IRR improvement by compressing the necessary investment, the efforts for a stable continuing CERs market from 2013 or later, the clarification of the main body who carries out the operation, maintenance and management of the Project and sharing of responsibility of risk and benefit among the participants, all of them should be worked out.
Co-benefits Effects(1) Sustainable Development Benefits - economic: The organic material recovered from the decanter, and from the flocculation process, will have a high calorific value, and, after drying, will make a useful supplementary fuel for the Mill’s boiler. The organic waste materials from the FFB treatment process are currently consumed in the Mill as fuel for boiler operation, while there is the market for these organic by-products as fuel. Substitution with the material recovered by the Project will enable the Mill to sell more of its waste material to outside users. Further, the energy-consuming processes used in the Project will all be supplied by the Mill’s existing biomass co-generation system. Consequently, positive economic effects are expected.
(2) Sustainable Development Benefits – environmental:
    (a) Reduction in greenhouse gas emission
    (b) Water quality improvement of the nearby rivers and water source saving by reusing the treated wastewater for boiler water
    (c) Efficient use of the site space by abandoning the existing aerobic and anaerobic lagoons
    (d) Significant reduction in offensive odor on the Mill and the surrounding environment
    (e) Efficient use of the incineration ash emitted from palm oil mills
(3) Sustainable Development Benefits – social:
The diffusion of the technology in the other nearby mills will be expected and the local engineers will be trained, which has the prospects of employment effect and then socioeconomic effects are also expected.

| Home | About GEC | Activities | Publications |

Copyright Global Environment Centre Foundation (GEC). All rights reserved..