Malaysia's Palm Oil Industrial Cluster to buy biomass for energy generation

(ADPnews) - Sep 27, 2010 - Malaysia's Palm Oil Industrial Cluster (POIC) confirmed that it intended to buy oil palm biomass from millers to use for power generation, Raymond Tan, Minister of Industrial Development said.

The cluster has received financial support by the eastern Sabah state government. The initiative aims to use biomass as fuel for electricity generations, instead of letting it rot, which, in addition, will allow millers to raise some money by selling organic waste to the government, Tan said.

Initially, the Lahad Datu-based cluster plans to purchase biomass from some of the 176 palm oil mills located close to it. The total biomass output from all the mills in the state is estimated at up to six million tonnes.

At present, there are two biomass power facilities in Sandakan, the second-largest city in Sabah, with a total capacity of 20 MW. A new plant in Lahad Datu is to start operations in late 2012, adding 23 MW to the state's biomass power capacity.

In October, Malaysia will introduce a new feed-in tariff scheme, which sees indicative rates of MYR 0.27 (USD 0.87/EUR 0.65) to MYR 0.31 per kWh for biomass in the coming 16 years.

(MYR 1 = USD 0.324/EUR 0.240)

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