Economic evaluation of biodiesel plant design in Bontang, East Kalimantan, Indonesia

Abstract

Biodiesel is an alternative fuel that was potential to be produced in Indonesia. Biodiesel can reduce dependence on fossil fuels so that large-scale biodiesel production was needed to encourage renewable energy application. In this research, plant design and economic evaluation of biodiesel plant will be carried out. The research aims to evaluate the economic of biodiesel plant design in Bontang, East Kalimantan, Indonesia at 2023. The designed of biodiesel plant had 68,000 tons/year capacity with Crude Palm Oil (CPO) and methanol as raw materials which will be built in 2026 at Bontang, East Kalimantan. Bontang was chosen by considering the industrial area, proximity to raw materials, ease of transportation and utility. The process technology used in biodiesel plant design was transesterification reaction with a liquid phase base catalyst. From profitability analysis showed that 53.17% Return of Investment (ROI), 2.35 years Payback Period (PBP), US$ 22,237,387 Net Present Value (NPV), and 33.5% Internal Rate of Return (IRR).