MANAGEMENT OF WASTE AND ITS UTILIZATION AS ONE OF THE ENERGY

SOURCES AND ALTERNATIVE FUELS: A CASE STUDY OF SAMPAH SUWUNG BALI

FINAL WASTE DISPOSAL

Agunan P. Samosir

This study aims to determine the policies of the Central Government, especially the Ministry of Finance
in order to assist Local Governments (Regional Governments) both Provinces and Districts / Cities in
managing waste completely and utilized as new renewable energy sources, namely Waste Power Plants
(PLTSa). This study uses a qualitative descriptive approach and secondary data sources as well as a
field survey to TPA Suwung, Denpasar, Bali. The results of the study show that support from the Central
Government from the Budget and State Revenues (APBN) is needed by the Provincial Government
(Provincial Government) of Bali, Denpasar City Government, Badung Regency Government, Gianyar
Regency Government, and Tabanan Regency Government. The support is expected to reduce waste
problems in Denpasar City, Badung Regency, Gianyar Regency and Tabanan Regency (Sarbagita)
which have a positive impact on the tourism sector. Such support can be provided as long as there are
commitments from the four regions by budgeting them in their respective Budget and Regional
Revenues (APBD). The commitment is the cost of waste processing services (BLPS) in the Suwung
landfill or known as tipping fees. The cost of waste management services is the cost or waste processing
services provided to the landfill manager by the local government beyond the costs of collection,
transportation and final processing. Waste service costs are used by waste management in the landfill
to reduce waste as much as possible by paying attention to the environmental impacts around the
landfill.

Keywords: waste management, renewable energy, waste processing service costs, APBN and APBD.

PREFACE
Solid waste is one of the typical urban problems and tourist areas in the country as a result of community
activities. Along with population growth and the economy, the amount of waste in urban and tourist
areas is increasingly growing. If these conditions are not balanced with serious waste management, the
adverse effects of waste such as odors and environmental pollution are inevitable and potentially will
worsen. This condition clearly creates pollution or GHG emissions. The impact of solid waste
generation in the landfill results in the contribution of GHG emissions, including methane (CH4) and
carbon dioxide (CO2) around 5% of the total global GHG emissions (IPCC, 2007).
The issue of waste management in Bali is important for the Central Government in addition to hygiene
and environmental health aspects, Indonesia precisely in Bali will host the International Monetary Fund
(IMF) Annual Meeting and the World Bank (WB) meeting in October 2018. Indonesia's success in
organizing a trial The annual event is not only determined from accommodation, venue and access but
also from the cleanliness of the venue environment which is free from garbage. Therefore, waste
management is one of the things that must be formulated a reduction strategy to its destruction.
At present the amount of waste generated by Sarbagita has experienced overcapacity at the Suwung
landfill. A study conducted by the World Bank, PPP-SWM (1999) states that the volume of waste
produced from the four Sarbagita regions in 2002 reached 3,000 m3 per day or around 1,000 tons per
day. About 70 percent of the total waste is a type of organic waste. The Central Statistics Agency (BPS)
in Denpasar said that the generation of waste originating from Denpasar City in 2017 had reached 3,200
m3 per day or 1,000 tons per day. It is estimated that the total waste from Sarbagita sent to the Suwung
landfill reaches 2,000 tons per day.
Another thing that is feared is that when the tide of the sea will flood the Suwung landfill area mixed
with leachate. In turn, the quality of the soil around the Suwung landfill will be polluted and other
impacts will cause the health of the surrounding community to be disrupted. This condition is what
drives the Central Government to help solve waste so that it does not become a major problem in the
future.
Based on the description above, the formulation of the problems raised in this study are (i) how the
Provincial Government of Bali and the Sarbagita Regional Government manage waste that has the
potential to generate waste-based electricity and as an alternative fuel? (Ii) how to determine the amount
of tipping fees and selling prices electricity generated by the Suwung landfill manager? What parties
are involved ?, and (iii) what forms of support can the central government provide to the regions to
destroy waste in the Suwung landfill area?

METHODOLOGY
This study was prepared using secondary data sourced from the Ministry of Environment and Forestry
(KLHK), Denpasar City Regional Government, Sarbagita Waste Management, Ministry of Finance and
also from literature studies and in-depth discussions through focus group discussions (FGD) as well as
in depth interviews with resource persons who are experts in the field of environment and waste
management.
Descriptive analysis and interpretation of regulations related to waste management and field surveys to
TPA Suwung, Denpasar, Bali in 2017 are additional information that is no less important to complete
the analysis and discussion. The experience of other countries in the framework of processing waste
into an energy source and alternative fuels as well as others is carried out with literature studies.
Qualitative data collected successfully is processed to produce a study recommendation.

LITERATURE REVIEW
Waste Management Policy
The high level of community activity in urban and tourist centers in Indonesia has triggered the
production of waste which is increasingly growing along with the rate of population growth. Moreover,
economic opportunities in an increasingly open city and improved modes of transportation have
contributed to an increase in the rate of urbanization. If not handled properly, urban waste can cause
various problems, such as environmental, health, and even social.
The importance of proper waste management has been realized by the Government with the issuance
of Law number 18 of 2008 concerning Waste Management (Waste Management Act / UUPS). The
UUPS mandates that waste management must be carried out with an environmental perspective and
carried out with the principles of responsibility, sustainability, benefits, justice, awareness,
togetherness, safety, security and economy. The UUPS requires everyone to reduce waste and assign
the government and local government to ensure that waste management is carried out.
Waste management according to the UUPS must be carried out thoroughly by reducing the amount of
waste and handling waste. Waste reduction can be done through waste generation restrictions, recycling,
and waste reuse. Meanwhile waste management includes sorting, collecting, and moving waste to
temporary shelters (TPS) or integrated waste processing facilities (TPST), transportation to final
processing sites (TPA), waste processing, and final processing of residues to be returned to natural
media secure.
In addition, the Government also issued Government Regulation number 81 of 2012 concerning
Household Waste Management and Household-like Waste (PP 81/2012) which regulates the
implementation of waste handling in more detail. According to the PP, waste management policies and
strategies must be formulated at each level of government by at least covering the direction of
government policies and programs. The regulation also regulates the participation of communities,
producers, research institutions, ministries / institutions, and universities in waste management, one of
which is providing and sorting waste.

The Role of Local Government Against Waste Management

In guaranteeing the implementation of waste management, the UUPS regulates the authority of waste
management owned by the Provincial and Local Governments. In the UUPS, the authority of the
Provincial Government is: (i) establishing policies and strategies for waste management; (ii) facilitate
cooperation between regions in one province, partnerships, and networks in waste management; (iii)
coordinating, coaching, and monitoring the performance of the district / city in waste management; and
(iv) facilitate the settlement of waste management disputes between districts / cities in one province.
Meanwhile, the authority of the District / City Government includes the authority to: (i) establish
policies and strategies for waste management in accordance with national and provincial levels; (ii)
organizing waste management in accordance with the norms, standards, procedures and criteria
established by the Government; (iii) fostering and supervising waste management work by other parties;
(iv) determine the location of temporary garbage shelters, integrated waste management facilities, and
/ or the final waste processing site, in accordance with regional spatial planning according to the
applicable law; (v) monitor and evaluate the final waste processing site with an open disposal system
that has been closed every six months for 20 years; (vi) compile and implement a waste management
emergency response system in accordance with its authority and further regulated in a Ministerial
Regulation.
In order to reduce the amount of waste that has increased from year to year, the Regional Government
has several obligations. Together with the Central Government, Local Governments are required to set
waste reduction targets in stages over a period of time and facilitate the application of environmentally
friendly technologies for waste management. In addition, the Regional Government is also obliged to
facilitate labeling of products that are environmentally friendly by producers, facilitating the reuse of
used goods, facilitating recycling activities, and marketing the recycled products.

Trash Becomes Energy

Utilization of urban waste for electricity sources through waste power plants (PLTSa) or known as
waste to energy (WTE) has strategic value because it deals with important issues in Indonesia. First,
WTE is in line with the national commitment to reduce emissions by 29% by 2030 stated in the NDC.
Second, the existence of new energy sources can be part of a solution to increase the availability of
electricity that limits fossil energy use. Third, PLTSa can overcome urban landfills that have large
volumes so as to improve the quality of the environment and public health. Finally, PLTSa can be a
solution to deal with the limited capacity of the landfill.
In developing waste to energy, there are several things that need to be considered, including quantity,
quality, and continuity of waste as PLTSa fuel. In terms of quantity, the potential for biomass for
electricity generation in Indonesia is quite large. Waste production in major cities in Indonesia is
estimated at more than 1,395 tons per day (KESDM, 2017). According to a survey of the Ministry of
Energy and Mineral Resources in 2011-2012 (KESDM, 2017), the potential for municipal solid waste
reaches 4.68% of the total biomass potential of 32.654 MWe.
In terms of quality, composition and characteristics of waste can affect the calories produced from WTE
technology. In Indonesia, the composition of organic waste dominates. The portion of organic waste
reaches 55-65% of urban waste. The remaining 35-45% consists of plastic, paper, rubber textiles,
leather, glass, B3 waste and other non-organic waste. Because of these characteristics, with a water
content of 40-60% and ash content of 10-25%, the potential for calories produced by urban waste in
Indonesia ranges from 1,000 to 1500 kcal per kg.
In terms of continuity, the capacity of PLTSa must be designed in accordance with the quantity of waste
production in the area handled, both production in the current year and in the future. Because PLTSa
will operate in the medium to long term, the development of PLTSa should take into account that the
waste of large cities in developing countries, including Indonesia, still has a tendency to increase along
with the increase in income. With the ever-positive population and economic growth, waste production
in Indonesia is expected to increase, both per capita and overall.
So far, there are four technologies commonly used in converting waste into energy, namely incinerator
(thermal incineration), thermal gasification (gasification), mechanical biological treatment / refused
derived fuel (RDF), anaerobic digestion (pyrolysis), and landfill gas to energy ( sanitary landfill.
Incineration is the processing of excess oxygen / air, low levels of gasification, pyrolysis with no
oxygen, while RDF is carried out by reducing moisture and the size of the waste to produce consistent
fuel quality. Unlike the four technologies that are based on thermal, sanitary landfills use biology-based
technology, namely by fermentation of organic materials.

Waste into Alternative Fuels

Besides waste can be used as a waste power plant, the cement industry can also be used as an alternative
fuel to subsidize the main fuel. The main fuel that is always used by the cement industry is Coal.
Fuel derived from waste is referred to as refuse derived fuel (RDF). RDF which has certain calories can
be utilized in (i) cement kilns, (ii) thermoelectric power plants, and (iii) certain boilers. RDF has a large
calorific value, is easy to store, easily managed, easily transportable and has low emission pollutants
(Gendebien et al., 2003; Kobayashi et al., 2005).
Waste that is processed into RDF is easier to burn on cement industry incinerator and kiln technology.
Usually RDF is formed into a brecket or pellet. With the pattern of waste management using RDF can
reduce the volume of waste that must be sent to the landfill significantly. Some of the technologies used
to destroy garbage can be seen in Figure 1.
Figure 1. Waste Management Technology into Fuel
Based on the purpose of utilizing processed waste, the technology known in Figure 1 above uses (i)
thermal or incinerator that directly burns waste, (ii) kilns in the cement industry using RDF, and (iii)
thermal or incinerators using RDF.

Waste Management in Japan

In connection with the increasing economic development, industrialization and increasing population
in Japan, the problem of waste is becoming more serious to be considered. There is a saying that is still
a guideline for Japanese society to date, namely Mottainai, which can be interpreted as an effort to
respect and use everything as long as possible. Along with economic growth, Mottainai's spirit can
withstand the increase in waste generation and become a motivation in the development of reuse and
recycle technology.
Considering the limited land and the difficulty of finding land as a landfill, a system of collecting and
transporting waste, waste processing with incineration methods, as well as final disposal of sanitary
landfills is integrated to prevent pollution and ensure environmental sustainability in the future.
Around 1960, Japan began managing urban waste by incineration methods, and Japan currently has the
world's leading incineration combustion facility. In 2009, there were 1,243 incinerator facilities in
Japan, where garbage burning was carried out using several methods, including stoker furnaces,
fluidized bed furnaces, and gasification resource furnaces.
Along with the development of incineration methods that adopt environmental conservation technology,
incineration technology has been implemented that can convert waste into electricity, with the support
of safe operational technology. Currently also being explored about handling various types of waste to
be processed with incineration methods, not only high-calorie waste, but also low-calorie types of waste
that are produced in the Asian region.
With high-tech incineration facilities, waste incineration has won the trust of the people in Japan as a
safe technology. Communication to residents around the incineration plant that will be built can run
smoothly and there are no obstacles or resistance from residents, even though it was built in the middle
of a residential area.
Presidential Regulation No. 35 of 2018 is an initiative of the Central Government related to waste
management in the regions, especially cities. Some cities in Java, Bali, Sumatra and Sulawesi have not
been able to reduce waste in their respective landfills.
The purpose of the issuance of the Perpres is to improve public health and environmental quality and
reduce the volume of waste significantly for the cleanliness and beauty of the city. Waste management
will be a resource that provides waste to energy value added.
As an area that has experienced problems with solid waste, Denpasar City is designated as one of the
12 cities accelerating PLTSa development in Indonesia. Other cities included as an acceleration area
for PLTSa development included in the Presidential Decree 35 of 2018 include: (i) DKI Jakarta, (ii)
Bekasi, (iii) Tangerang, (iv) South Tangerang, (v) Bandung, (vi) Semarang, (vii) Surakarta, (viii)
Surabaya, (ix) Makassar, (x) Denpasar, (xi) Palembang, and (xii) Manado.
Especially for Denpasar City, the waste management cooperation agreement that has been carried out
between the Denpasar City Government, Badung Regency Government, Gianyar Regency Government
and Tabanan Regency Government known as the Sarbagita Regional Government remains valid before
the Presidential Decree 35 Year 2018 is issued.
The same thing also applies to the city of Bandung which has been carried out cooperation between the
Government of the Province of West Java, the City Government of Bandung, the City Government of
Cimahi, the District Government of Bandung, West Bandung Regency Government, Sumedang
Regency Government, and the Garut Regency Government carried out by the West Java Provincial
Government as the person in charge of the cooperation project remains valid before the issuance of
Presidential Decree 35 of 2018.
Until now, no waste management has built PLTSa, has carried out commercial operation date (COD)
with PT PLN. PLTSa in Indonesia is still in the process of development and using technology from
China that is not necessarily proven to be applied in Indonesia. To limit the number of equipment and
technology originating from abroad, the Perpres contained in article 17 supports investors for the
development of PLTSa prioritizing the use of domestic products.
Other support provided by the Central Government through the Presidential Regulation is the assistance
of waste processing service costs (BLPS) of a maximum of Rp500,000 per ton of waste and electricity
subsidies due to the difference in feed in tariff with the cost of production of PT PLN.

Bali Waste Management

The issue of waste management in Bali is important for the Central Government in addition to hygiene
and environmental health aspects. Indonesia precisely in Bali will host the IMF-WB Annual Session
meeting in October 2018. Waste management at the Suwung Landfill began in 1984 after the Ministry
of Forestry (Kemenhut) granted permission to the Bali Provincial Government to use 10 hectares of
land in the Great Forest Park area ( Tahura) Ngurah Rai which is used as a place for waste management
with a period of 20 years.
The Sarbagita Government cooperates with the handling of waste, which is carried out through the
establishment of the Suwung Landfill. The Suwung TPA is a Sarbagita Regional Landfill located in the
Ngurah Rai Forest Park (Tahura). The landfill stands on the Ministry of Forestry's land, which in 1984
gave permission to the Regional Government of Bali to utilize part of the 10-hectare Tahura area as a
waste disposal for 20 years. Furthermore, the area loaned by the Ministry of Forestry is used as Denpasar
Final Waste Disposal Site (Denpasar TPA / Suwung Landfill).
As economic growth progresses in Bali Province, waste production continues to increase so that landfill
waste in the Suwung landfill continues to grow. The landfill finally covers an area of 32.64 hectares
which is still part of the Tahura Ngurah Rai area. While the permit granted by the Ministry of Forestry
in 1984 was only for an area of 10 hectares, so that around 22.64 hectares of the Tahura area was
covered in trash. The extent of the landfill that covers the Ngurah Rai Tahura area due to the
management of landfill is done without an open dumping process. In waste management, the Provincial
Government of Bali encourages the involvement of city and district governments. Furthermore, in 2001,
the Denpasar City Government, Badung Regency Government, Gianyar Regency, and Tabanan
Regency formed cooperation in the management of waste from these 4 regions in the Suwung TPA area
by establishing the Denpasar Hygiene Management Agency, Badung, Gianyar, Tabanan (Sarbagita
BPK / BPKS). The establishment of the BPKS through the establishment of a Joint Decree (SKB)
signed by the Mayor of Denpasar, the Regent of Badung, the Regent of Gianyar and the Regent of
Tabanan.
BPKS is formed to facilitate coordination of waste handling between the municipal government and the
district government related to the Bali Provincial Government, and to facilitate cooperation with third
parties if needed. BPKS also has the task to unravel the problems in waste management at the Suwung
landfill. BPKS operations are supported by funds from the Provincial Government of Bali, Denpasar
City Government, Badung Regency Government, Gianyar Regency Government and Tabanan Regency
Government. However, the support of the Provincial Government of Bali's budget for BPKS was only
given in the period 2004-2006, and after that there was no operational funding support to BPKS.
Since 2003, BPKS operational costs have been fully sourced from the Sarbagita Government. It was
agreed that the amount of costs incurred was based on the calculation of the amount of landfill in each
region, namely Denpasar 31.5%, Badung 43.5%, Gianyar 17.5% and Tabanan 7.5%. The budgeting is
carried out in various ways by each Sarbagita Regional Government, in the form of grants (Denpasar
and Badung) or included as part of the budget of the Environment and Hygiene Service (Gianyar and
Tabanan). In addition, the fulfillment of funding based on this percentage has also never been fully
fulfilled. In 2004, when the land use permit at the Suwung landfill will be completed, the Bali Provincial
Government proposed an extension of the land use permit to the Ministry of Forestry.
The Ministry of Forestry fulfilled the application submitted for the use of the Tahura Ngurah Rai land
use until 2024. In the permit, the Ministry of Forestry decided that 10 hectares of land was managed by
4 second-level regional administrations namely Sarbagita. Upon granting the permit, the Ministry of
Forestry provides conditions in which 22.64 hectares of land that is buried in Suwung landfill waste
must be rehabilitated / reclaimed with environmentally friendly technology. The 22.64 hectare land use
permit was given to the Provincial Government of Bali. The provincial government of Bali then handed
over the management of 22.64 hectares of land in the Suwung landfill to be better managed by the
BPKS.
For this assignment, BPKS cooperated with PT. Navigat Organic Energy Indonesia (NOEI) to manage
waste on 22,64 hectares of land with a sanitary landfill system. In the cooperation agreement, NOEI
said that it did not ask for tipping fees for the 4 regional governments. The income of the Suwung
landfill waste manager is derived from the sale of electricity derived from methane gas (CH4). In its
journey, PT NOEI was unable to fulfill the promised business plan to the Sarbagita Regional
Government, which resulted in piles of garbage continuing to accumulate and pollute the environment
around the Suwung landfill. Subsequently in June 2016, PT NOEI's contract was terminated which was
due to expire in 2024. Until now no other investor has been appointed to manage the Suwung landfill.
Waste segregation policy through the reduce, reuse, and recycle (3R) program has been carried out, but
not yet thoroughly. So it doesn't help much to reduce the supply of waste to the Suwung landfill. The
Provincial Government of Bali and the Sarbagita Regional Government involved in Sarbagita waste
management at the Suwung Landfill support the wishes of the Central Government through the
Coordinating Minister of Maritime Affairs (Menko Maritim) requesting that waste management in Bali
be carried out properly in order to support the implementation of the 2018 IMF-WB Annual Meeting.
And also includes the discourse of processing the waste through a garbage power plant (PLTSa) at TPW
Suwung.
Related to the PLTSa development discourse in the Suwung TPA, it was considered very difficult with
the target given that in August 2018 the PLTSa could operate. This is because the process takes a long
time in the licensing and construction of PLTSa. PLTSa construction itself takes about two years since
the signing of the power purchase agreement (PPA). The main underlying problem is related to the use
of the Suwung landfill Kasawan permit which will expire in 2024, so this condition will be less feasible
in the PLTSa development plan. The first step that must be resolved is to obtain a license extension
from the Ministry of Environment and Forestry (KLHK) for the use of the Tahura Ngurah Rai area
which is currently used for the Suwung Landfill,
Sarbagita Regional Government has submitted a request letter to the Minister of Environment and
Forestry to be able to extend the land use permit. The request was also conveyed so that later the permit
granted by KLHK to the Sarbagita Regional Government was on 32.64 hectares of land, which in the
current permit 10 hectares of land was loaned by KLHK to the Sarbagita Regional Government and
22.64 hectares to the Bali Provincial Government. In the application, a permit extension was submitted
for 30 years up to 2047.
Regarding the PLTSa development discourse at the Suwung TPA, the BPKS has an integrated waste
management plan in the Suwung TPA where PLTSa will be built on 10 hectares of land. While in the
22.64 hectare land, waste management will be applied with sanitary landfill techniques. Landfills that
currently accumulate on 22.64 hectares of land will be a supply of raw materials for PLTSa. So that it
will reduce the existing landfill.
In order to follow up on the Central Government's wishes regarding waste management at the Suwung
TPA, it can be done well and does not create an unfavorable image of waste management in Bali in the
eyes of foreign delegates who will attend the 2018 IMF-WB Annual Meeting, Sarbagita Regional
Government offers short-term solutions with a greening program and the use of a plastic layer to cover
the piles of garbage in the Suwung landfill area. So that it can cover the view of the Suwung TPA from
the air when the plane will land at Bali Airport.
The issue of waste management in the Suwung landfill is also the concern of the relevant local
government, not only because of the pressure from the central government. In recent months there have
been demands from the Balinese people, especially those around the Suwung landfill. The community
asks the local government in Bali to better manage it. Even the community has threatened to close the
Suwung TPA if the management is not repaired. If closure is done then waste management in Bali will
damage the tourism sector. This condition will certainly have a negative impact on Bali's economy.
Sarbagita Regional Government really hopes that the Ministry of Environment and Forestry can
immediately make a decision on the application that has been submitted. And then it will be a
consideration in establishing further policies in the management of the Suwung landfill. Certainty of
land use permits from KLHK is an important component in the formulation of further waste
management policies at the Suwung landfill. This is related to the authority of the Provincial
Government of Bali, Denpasar City Government, Badung Regency Government, Gianyar Regency
Government and Tabanan Regency Government. Certainty of who is more authorized will later become
the basis for the PLTSa development plan, including in the plan to invite investors to manage the
Suwung landfill.
With regard to the cooperation of Denpasar City Government, Badung Regency Government, Gianyar
Regency Government and Tabanan Regency Government through operational funding support the
Sarbagita Hygiene Management Agency (BPKS) needs to strengthen BPKS financial governance. This
is because of the 4 regional governments, two of which provide budget support through the allocation
of grant funds in the APDB. In accordance with applicable regulations, grants cannot be made
continuously. This condition has the potential to become a problem (finding) related to financial
management audits of the 4 relevant local governments. Option to form a Regional-Owned Enterprise
(BUMD) either by one of the city / regency governments or formed jointly by following existing
regulations.
Strengthening the financial management of BPKS well will create good governance and then will also
provide opportunities for the possibility of being able to enjoy other financing facilities such as grants
from international donors. Related to the PLTSa development plan, that in the discussion of the Perpres
revision on the acceleration of PLTSa development has been planned for the addition of Denpasar City
in addition to the 7 cities previously listed in Perpres No. 18 of 2016.
Sarbagita Regional Government really hopes for support from the Central Government for waste
management in Bali. Fiscal incentive support such as tax facilities, subsidies and assistance for the cost
of waste management services (tipping fees). Considering that waste management is the responsibility
of the city / district and provincial governments in accordance with the Regional Autonomy Law.
Providing support in improving the financial management of BPKS in order to create a good and correct
financial system in accordance with applicable regulations, including the tools of regional regulations
that are needed to improve the quality of BPKS financial governance.

BUILDING IN BALI AND DENPASAR

Based on the survey results, buildings in Bali have the same height between buildings both for hotels
and high-rise buildings. The height of buildings in Bali on average does not exceed coconut trees. Bali
Province Regional Regulation (Perda) Number 16 of 2009 concerning Bali Province Spatial Plan 2009-
2029 in Article 95 paragraph (2) states that the height of buildings that utilize air space above the earth's
surface is limited to a maximum of 15 meters. Building height restrictions apply throughout the island
of Bali.
Regarding the height of the building, the Denpasar City Government also issued Denpasar City
Regulation Number 5 of 2015 concerning Building Buildings in Article 7 paragraph (8) states that the
height of buildings in the Denpasar area is a maximum of 15 meters. Thus, buildings in Denpasar City
will follow the rules set by the Denpasar City Government.
The use of incinerator technology that has been in the countries of Singapore, Japan, South Korea and
Europe has a chimney with a height of more than 150 meters (NEA, 2018). The purpose of the high
chimney is to reduce the impact of smoke, namely flying ash and dioxin directly to the community.
Given the rules set by the Denpasar City Government, the use of incinerator technology used in the
countries above is most likely not applicable in Denpasar City. Technology using chimneys not
exceeding the 15 meter limit is a challenge for investors to build PLTSa.

Tipping Fee
As stated in the previous chapter, the tipping fee is charged when waste is processed or destroyed using
certain technology. The fee is given to the waste manager in the final disposal site (TPA), for example
TPA Suwung, Denpasar. The amount of the tipping fee varies depending on the location of the landfill,
the type of waste, and the amount of waste, namely the rupiah or certain currencies per ton. While the
cost of collecting, transporting and operating costs of waste is borne by the APBD of each region.
Perpres 97 of 2017 concerning National Policies and Strategies for Household Waste Management and
Household-like Garbage Waste states that waste handling is carried out starting from (i) sorting, (ii)
collection, (iii) transportation, (iv) processing, and (v) final processing. These four and five items are
part of the tipping fee. In some countries the tipping fee is known as the gate fee. Thus, the tipping fee
is given to investors who process waste to be destroyed. Usually the processed products will be used as
briquettes, pellets, cement mixtures, and sources of electrical energy derived from combustion.
The application of tipping fees in Indonesia has been carried out in various regions such as DKI Jakarta,
Bandung and its surroundings, and the city of Surabaya. The amount of the tipping fee is IDR 50,000
to IDR 200,000 per ton. Whereas in other countries such as Japan amounted to USD 150 per ton, Korea
amounted to USD 100 per ton, the city of Bangkok amounted to USD 30 per ton, the city of Kuala
Lumpur was USD 25 per ton, and Singapore amounted to USD 60 per ton.
Almost all countries believe that the objective of financing waste processing (tipping fees) includes: (i)
encouraging an investment climate in infrastructure, especially in the waste sector, (ii) utilizing,
facilitating, and developing waste processing products to obtain waste-based electricity generation , (iii)
increasing the participation of the community and business actors to actively reduce or handle waste
that is environmentally sound (reducing the negative impact of waste on the environment), (iv) utilizing
and facilitating the application of waste management technology that develops in the community, (v)
making waste as a resource that has economic value, and (vi) improves the quality of services for the
community.
Tipping fees are sourced from APBD and APBN. APBD can use direct shopping, build operate transfer
(BOT) schemes and government and business cooperation schemes (PPP), while the APBN includes (i)
grants, (ii) physical DAK, (iii) non-physical DAK, and others. Waste-based electricity generation
(PLTSa) is an alternative solution in addition to addressing the problem of environmental impacts as
well as changing the solid waste mindset into energy (waste to energy).
For the effectiveness of PLTSa waste treatment, it is necessary to approach the Regional Government
and Business Entity (PPP) by referring to the Presidential Regulation Number 38 of 2015 concerning
Government Cooperation with BU in the Provision of Infrastructure and Permendagri Number 96 of
2016 concerning Payment for In-Service Availability Framework for Regional Government
Cooperation with Business Entities in the Provision of Infrastructure in the Regions.
In order to accelerate and provide legal certainty, tipping fees are very specific. Waste management can
be done through a limited auction mechanism, by including a minimum of three Business Entities /
Private entities as long as they have thermal process technology capabilities such as: (i) gasification,
(ii) incinerator; and (iii) pyrolysis; or using PPP as stipulated in Article 1 number 3 of Perpres No. 18
of 2016. Issuance of formal legal / Decree of the Minister of Finance concerning compensation for
purchasing electricity from PLTSa and the mechanism for determining the selling price of processed
waste products due to PPP being processed into electricity to PLN according to the scale of economics.
Imposition of tipping fees is a normal matter in several countries in Europe and East Asia. The tipping
fee is due to the cheap price of electricity sold from the power plant to PT PLN, which is around USD
6-7 per kWh. However, the results of a study conducted by the International Finance Corporation (IFC)
in 2016 stated that the electricity tariff sold by the feed-in tariff (FiT) was USD 18.77 cent per kWh and
a waste tipping fee of Rp.205,000-Rp315 was needed. 000 per ton. The following can be seen in the
table of recommendations of the IFC study on tipping fees in the cities of Tangerang and Makassar
when a Waste Power Plant (PLTSa) is built.

Table 1. Feed in tariff for PLTSa and Tipping Fee in Tangerang City
 WtE Tangerang Tipping Fees (IDR/Ton)
IRR = 12%
Assumptions of the installed capacity = 17-19 MW
1. Scenario FiT = 18.77 cent/kWh VGF = 0 205.000-315.000
2. Scenario FiT = 18.77 cent/kWh VGF (33%) = USD 38 Million 0
3. Scenario FiT = 18.77 cent/kWh VGF (49%) = USD 57 Million 0

Table 2. Feed in tariff for PLTSa and Tipping Fee in Makassar City
WtE Makassar Tipping Fees (IDR/Ton)
IRR = 12%
Assumptions of the installed capacity = 14-16 MW
1. Scenario FiT = 18.77 cent/kWh VGF = 0 205.000-315.000
2. Scenario FiT = 18.77 cent/kWh VGF (33%) = USD 34 Million 0-60.000
3. Scenario FiT = 18.77 cent/kWh VGF (49%) = USD 50 Million 0

The provision of tipping fees can be reduced if the construction of PLTSa uses the PPP mechanism to
obtain a viability gap fund (VGF) facility. The greater the VGF obtained, the smaller or no longer
needed the tipping fee given by the Tangerang and Makassar Regional Governments. The Japanese
Ministry of Environment study also said that the provision of tipping fees to the waste management of
Final Waste Management Sites is the obligation of the local government.
Changes in the amount of tipping fees also influence the return on capital from investors, namely
internal rate return (IRR). The smaller or no tipping fees, the investment that will be carried out in
waste-based power plants is not feasible or not attractive to investors. This is shown in the simulation
table with some simulations namely simulation 1 - simulation 8. Simulations 6, 7 and 8 are not attractive
for investors to want to build PLTSa. The following table impacts the joint crediting mechanism (JCM)
due to changes in the tipping fee.
1JCM is a project to reduce emissions and reduce greenhouse gas emissions in partner countries. As a result of emission
reduction, Japan will get funding or credit according to its contribution. Loans issued in Japan can be used to achieve Japan's
emission reduction targets. Loans issued in partner countries will also be used according to their activities.

Table 3. Impact of Joint Crediting Mechanism (JCM) Due to Changes in Tipping Fee
Case 1 Case 2 Case 3 Case 4 Case 5 Case 6 Case 7 Case 8
Tipping Fee 350.000 315.000 245.000 175.000 105.000 70.000 35.000 No TF
(IDR)
Power Selling 18,77 (USD cent/kWh)
Price
PIRR 14,08 13,52 12,40 11,25 10,07 9,46 8,85 8,23
EIRR 25,05 23,74 21,16 18,63 16,16 14,95 13,74 12,54
Min 1,47 1,41 1,30 1,19 1,08 1,03 0,97 0,92
DSCR Ave 1,95 1,88 1,76 1,64 1,51 1,45 1,39 1,32
Max 2,22 2,15 2,01 1,87 1,73 1,66 1,59 1,52
Evaluation Feasible Feasible Feasible Feasible Feasible Moderate Not Feas Not Feas

The table above shows the selection of technology will affect the presence or absence of tipping fees.
The choice of technology also affects the volume of landfill that is processed. Technology selection
affects the amount of government support (APBN). The development of PLTSa with gasification
technology gives investors a great advantage, namely interest rate of return (IRR) of 14% -20% and
payback period (PBP) below 10 years.
Electricity Subsidy and Waste Management Service Fee Assistance
To support the acceleration of PLTSa development in accordance with Perpres 35 of 2018, one of which
is the City of Denpasar is the provision of electricity subsidies by setting a feed-in tariff to investors
with a capacity of <20 MW of USD 13.35 cents per kWh by purchasing electricity or PT PLN's cost of
production is USD 6.81 cents per kWh. The electricity subsidy allocated in the APBN for Denpasar
City from PLTSa is USD 6.54 cents per kWh or IDR 882.9 per kWh. The exchange rate assumption
used is IDR 13,500 per 1 USD.
The provision of electricity subsidies through the establishment of feed in tariffs is to invite foreign and
domestic investors to invest funds and technology that are proven to reduce waste and produce
processed products as electricity. This large tariff is clearly very profitable for investors and is a burden
to the Government because there is a large difference between feed in tariff and PT PLN's cost of supply
(BPP). The regulation was adjusted by the ESDM Ministry in 2017 through number 12 and number 50.

Table 4. Central Government Regulations Supporting PLTSa Development

No. Regulasi Harga Pembelian Teknologi
1. Permen ESDM 19/2013 Rp1.250 / kWh ≤ 10 MW TM Zero Waste
4 Juli 2013, PLTSa Rp1.798 / kWh TR
Mencabut Rp1.250 / kWh ≤ 10 MW TM Sanitary Landfill
Permen ESDM 4/2012 Rp1.598 / kWh TR
2. Permen ESDM 44/2015 USD 18,77 / kWh ≤ 20 MW TT, Thermochemical
31 Desember 2015, PLTSa USD 22,43 / kWh TM
Mencabut TR
Permen ESDM 19/2013 USD 16,55 / kWh ≤ 20 MW TT, Sanitary Landfill
USD 20,16 / kWh TM Anaerob Digestion
3. Perpres 3/2016 Pembangunan PLTSa Semarang,
8 Januari 2016, PSN Makassar, Tangerang
4. Perpres 18/2016, 13 Feb 2016, PLTSa Permen ESDM 44/2015 Gasifikasi
Dicabut dengan Kep. MA 27 Incinerator
P/HUM/2016, 2 Nov 2016 Pyrolysis
5. Permen ESDM 12/2017 Harga patokan pembelian TL Sanitary Landfill
27 Januari 2017, EBT paling tinggi sebesar BPP Anaerob Digestion
setempat, kec PLTSa Thermochemical
Percepatan
6. Perpres 58/2017 Percepatan Pemb. PLTSa Jakarta,
15 Juni 2017, PSN Tangerang, Bandung, Semarang,
Mencabut Surakarta, Surabaya, Denpasar &
Perubahan Perpres 3/2016 Makassar.
7. Permen ESDM 50/2017 Harga patokan pembelian TL Sanitary Landfill
7 Agustus 2017, EBT paling tinggi sebesar BPP Anaerob Digestion
Mencabut setempat Thermochemical
Permen ESDM 12/2017
8. Perpres 35/2018 USD 13,35 cent / kWh ≤ 20 MW Incinerator or Thermochemical
12 April 2018, WTE USD cent / kWh = 14,54 – ≥ 20 MW
Mencabut Perpres 18/2016 (0,076 x capacity of plant)

Sumber: Kemenhumkam, 2013-2018

PLTSa = Pembangkit Listrik Berbasis Sampah PSN = Proyek Strategis Nasional

TT = Tegangan Tinggi, TM = Tegangan Menengah, TR = Tegangan Rendah

EBT = Energi Baru Terbarukan TL = Tenaga Listrik, BPP = Biaya Pokok Penyediaan

ESDM Minister Decree No. 1772 K / 20 / MEM / 2018 dated March 29, 2018 states that the 2017 BPP
Generation of PT PLN in the Bali region is USD 6.81 cent per kWh or around Rp911 per kWh. The
size of the BPP almost certainly reduces investor interest in entering PLTSa development. Initially, the
tariff setting in Perpres No. 18 of 2016 is very high, namely USD 18.77 cents per kWh or around IDR
2499.72 per kWh with an exchange rate of IDR 13,307 / USD. Subsequently revised with Perpres No.
35 of 2018. Some amount of BPP
Other support is tipping fee assistance, which is a maximum of Rp. 500.00 per ton of waste and
generally applicable fiscal incentives. The problem of waste in various cities is a concern of the central
government so that waste management does not disrupt tourism, environmental, health activities and
the holding of the 2018 WB-IMF annual session in Bali. The support provided through repeated
discussions is the provision of assistance in the processing of waste (tipping fees) in each TPA for areas
designated as an acceleration area for PLTSa development. Aid for waste processing services is
provided through non-physical special allocation funds (DAK) which are allocated annually in the
APBN and require DPR approval. The amount of assistance will be arranged in the Minister of
Environment and Forestry Regulation.
In addition to electricity subsidies and tipping fee assistance, the Central Government also provides
taxation and customs facilities for renewable energy (EBT) through Minister of Finance Regulation No.
21 of 2010, among others: (i) Income Tax facilities, (ii) VAT facilities, (iii) Import Duty facilities and
(iv) tax facilities borne by the Government.
First, the Income Tax facility is (i) a reduction in net income of 30% (thirty percent) of the total
Investment, charged for 6 (six) years each of 5% (five percent) per year; (ii) accelerated depreciation
and amortization; (iii) Imposition of Income Tax on dividends paid to Overseas Tax Subjects amounting
to 10% (ten percent), or lower rates according to the applicable Double Tax Avoidance Agreement; and
(iv) Compensation for losses longer than 5 years but not more than 10 years.
Second, the VAT facility referred to is the exemption from the imposition of VAT on the importation
of strategic Taxable Goods in the form of machinery and equipment, both installed and released, not
including spare parts, which are required by employers in the use of renewable energy sources to
produce Taxable Goods .
Third, the import duty facility provided for the activities of utilizing renewable energy sources is the
facility for import duty exemption as stipulated in: (i) Minister of Finance Regulation Number 176 /
PMK.011 / 2009 concerning Exemption of Import Duty on Import of Machinery and Goods and
Materials for Development or Development Industry in the Context of Investment, along with its
amendments, and (ii) Regulation of the Minister of Finance Number 154 / PMK.01.1 / 2008 concerning
Exemption of Import Duty on Capital Goods Imports in the Context of Developing and Developing
Electric Power Generating Industries for Public Interest, along with their amendments.
Finally, the tax facility borne by the Government as referred to in PMK No. 21 / PMK.011 / 2010 is a
tax facility borne by the Government which is regulated by the State Budget Law and its implementing
regulations.

Waste Management Challenge

Considering that waste matters have become part of the Government's affairs, waste management no
longer makes waste simply stacked, but how can the waste entering the landfill be destroyed.
Destruction of waste can be done by direct combustion in incinerator technology or also processing
waste into briquettes or refused derived fuel (RDF) which is used as one of the fuel for steam power
generation. Incinerator and gasification technology is an issue that is constantly being raised by
environmental non-governmental organizations (NGOs). The combustion system can produce dust that
is harmful to public health. A slightly softer opposition is by gasification because waste is processed
into briquettes.
2PMK No. 21 of 2010 concerning Provision of Taxation and Customs Facilities for Utilization of Renewable Energy Sources
(EBT)

The next challenge is how the development of new renewable energy (EBT) of waste to energy (WTE)
can support targeted renewable energy use by 25 percent or 45 GW by 2025. In addition, the
government's commitment to the reduction of greenhouse gas (GHG) emissions by 29 percent or 314
million tons of CO2 in 2030. The commitment has implications for the state budget, including: (i) the
allocation of regional transfers through non-physical DAK increases every year. The provision of
tipping fees will cause injustice to other regions that are not included in the acceleration of PLTSa
development. (Ii) reduced state revenues by fiscal incentives, (iii) the provision of targeted electricity
subsidies and controlling mandatory spending, and (iv) financing the construction of PLTSa obtaining
government guarantees by the mechanism of cooperation with business entities (KPBU). The PPP
mechanism also facilitates projects to be implemented such as viability gap funds (VGF) and
availability payment (AV). Giving VGF and AV is supported from the National Budget.

CONCLUSIONS AND RECOMMENDATIONS

Conclusion
The main purpose of waste management in Bali is to destroy waste. Waste that can be processed can be
burned and the steam used as a power plant. Waste burning to produce electricity only reaches 17
percent. In addition to electricity generation waste can be used for alternative fuels in the cement
industry with RDF technology.
Waste management using thermal technology and RDF which are suitable for Bali Province, especially
Sarbagita. Both technologies are most effective in reducing waste volume. In accordance with
Presidential Regulation No. 38 of 2018 concerning the Acceleration of the Construction of Waste
Management Plants into Electricity-Based Electric Energy-Based Energy that stipulates the City of
Denpasar as one of the areas to accelerate the development of waste-based power plants (PLTSa). Thus,
Denpasar City can get support and assistance from the Central Government as long as the processed
waste at the Suwung TPA is utilized for electricity.
In waste processing, in addition to issuing the costs of collecting, transporting and final processing, the
Tipping Fee is given to the managers of the Suwung TPA to reduce and obtain the added value of waste
into electrical energy.
Denpasar City applies a Tipping fee policy, which is a waste processing fee outside the activities of
collecting, transporting and shipping waste. Imposition of tipping fees is a natural thing as well as
applied in several other countries such as Japan, America, Sweden, Denmark and Finland.
According to Law No. 32 of 2014 concerning Regional Government, Waste management is a regional
affair so that the provision of tipping fees is a regional obligation budgeted in the APBD.
Provincial Government Regulation Number 35 of 2018 aims to support the Regional Government,
especially the City of Denpasar to reduce waste significantly and the processed products can be utilized
as electricity. Central Government assistance includes: (i) electricity subsidies, and (ii) tipping fees or
BLPS in the form of Non-Physical Special Allocation Funds.
The average application of national generation BPP amounted to Rp1,025 or USD7.66 cents per kWh
and the determination of the purchase price of electricity in the Perpres amounting to USD13.35 cents
per kWh for a capacity below 20MW had a consequence to the amount of electricity subsidies providing
a USD5 subsidy , 69 cents per kWh which will burden the state budget. Nevertheless, the Government's
support for the acceleration of PLTSa development is in line with the commitment to reduce CO2
emission levels as stated by President Jokowi at the COP 21 meeting in Paris.

Recommendations
Waste processing technology in Bali, especially Sarbagita, must pay attention to environmental aspects
and height of buildings that limit a maximum of 15 meters. One technology that can be applied is
Circulating Heat Combustion System (CHCS) by applying an external burner and water tube boiler.
The height of the CHCS chimney technology is 14 meters. CHCS technology has been used by Bekasi
City at Sumur Batu Landfill.
Another suitable technology to be applied in Bali which is a tourism area is a technology known as
"Garbage Harmless Comprehensive Disposal Equipment (GHCDE)". This technology recycles all
waste into multi functions including: brick, light brick, ceramics, pallets, building partitions, ship dock
devices, door and window frames. Organic waste is processed into fertilizer that will be used by
agriculture and plantations. GHCDE technology is able to process waste up to 98% and is
environmentally friendly and free of bacteria. However, China's new GHCDE technology has been
implemented in Yuncheng City, Shanxi Province. The consequence of using this technology is that
Denpasar City does not get support from the Central Government based on Presidential Regulation No.
35 of 2018.
The amount of imposition of tipping fees in Denpasar City must be adjusted to the characteristics of the
garbage, the area, and the location of the landfill. The formula for calculating tipping fees can be known
from the amount of investment that will be carried out at the Suwung landfill. In addition to Denpasar
City, Badung Regency, Gianyar Regency and Tabanan Regency are obliged to contribute in the form
of tipping fees or the cost of waste management services (BLPS) to the waste disposal that the TPA
management will process. The amount of BLPS is allocated in the Sarbagita Regional Budget. The
amount of BLPS needs to be transparent and accountable with a mutually agreed formula or method.
Perpres 35 of 2018 in Article 15 paragraph (2) that the Central Government can provide BLPS
assistance of a maximum of Rp500,000 per ton through Non-Physical Special Allocation Funds (DAK).
Although the Central Government provided BLPS assistance, the largest portion of BLPS Denpasar
City Government, Badung Regency, Gianyar Regency and Tabanan Regency were at least 51% of
BLPS per ton. If the Sarbagita area has not been able to fulfill all the tipping fee obligations, Sarbagita
can request assistance to the Provincial Government of at least 25% and the Central Government to a
maximum of 24%. If the Bali Provincial Government is not willing to help the Sarbagita Regional
Government, the BLPS assistance provided by the Central Government is a maximum of 49%.
The purchase price of electricity from PLTSa for a certain rupiah was determined by Perpres No. 35 of
2018 which is USD 13.35 cent per kWh for a capacity of <20 MW and uses a formula for a capacity
of> 20 MW, namely USD 14.54 cent / kWh - (0.076 x the capacity of PLTSa). Determination of
electricity selling prices (feed in tariff) to provide certainty to investors that BPP Generation by PT PLN
does not experience changes during the cooperation agreement (PKS) without negotiation and without
escalation. The electricity selling price stipulated in Perpres 35 of 2018 has the effect of subsidizing
because PT PLN's cost of production (BPP) is Rp1,046 per kWh.
The provision of tipping fees provided by the Central Government through Non-Physical DAK needs
to be regulated in the Minister of Environment and Forestry Regulation. The following table is a
simulation of total tipping fees and electricity subsidies that can be based on the 2019 State Budget for
10 cities that are in the acceleration of PLTSa development.
Table 5. APBN Support to the Acceleration of PLTSa Development in Denpasar City.
Volum FIT Tipping TF Pemda TF Pemporv DAK NF Subsidi
e Fee Sarbagita Bali (APBN) Listrik
Sampa (51%) 25% & 0% 24% & (APBN)
h 51%
(ton) (Rp/kWh) (Rp/ton) (Miliar Rp) (Miliar Rp) (Miliar Rp) (Miliar Rp)
Denpasar (12 MW) 2.000 1.802,25 500.000 93,07 45,62 43,80 46,911
Denpasar (12 MW) 2.000 1.802,25 500.000 93,07 - 89,25 46,911

Based on the simulation of 2018 study results, APBN assistance or support for Sarbagita with the
assumption of (i) generated electricity of 12 MW, (ii) BLPS of Rp500,000 per ton, (iii) total waste per
day discharged to Suwung landfill is around 2,000 tons , (iv) feed in tariff (FiT) of Rp1,802.25 per kWh,
and (v) commercial operation date (COD) 1 July 2019 are as follows (i) Denpasar City electricity
subsidy of Rp.46.91 billion, (ii ) Non-Physical DAK assistance for tipping fees with a maximum criteria
of 24% of Rp. 43.8 billion, and (iii) non-Physical DAK assistance for tipping fees with a maximum
criteria of 49% of Rp. 89.42 billion.

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