Minister of Cooperatives and Small and Medium Enterprises of the Republic of Indonesia, Teten Masduki, second right, with Nestlé Indonesia's President Director, Ganesan Ampalavanar, right, and BECIS president director, Jawahar Harinarayanan, second left, visit Nestlé Indonesia Biomass Boiler Installation area at the Nestlé Karawang Factory in West Java on June 7, 2022. (Photo courtesy of Nestle Indonesia)

Nestlé Cuts Its Greenhouse Gas Emission in Indonesia

JUNE 13, 2022

Jakarta. Nestlé Indonesia, the local arm of Swiss multinational foods and beverages giant, unveiled a new $25.2 million investment in a new green manufacturing facility for Milo chocolate malt beverage last week.

The new facility highlighted Nestlé Indonesia's effort to help Indonesia achieve its net-zero emissions target by 2050 while eliminating the country's 271 million people's dependence on imports for the beverage. 

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"Our current focus is on our commitment to achieving Net Zero emissions by 2050 even as the company continues to grow," Ganesan Ampalavanar, the president director of Nestlé Indonesia, said over the weekend. 

Last Tuesday, the company inaugurated new facilities in its Karawang, West Java plant. The facilities cost Rp 368 billion ($25.2 million) in investment for additional installations of the vacuum band dryer (VBD 2) process machine and a biomass boiler.

The dryer allowed Nestlé Indonesia to increase Milo's domestic production and meet 100 percent of the local demand for the beverage. 

"This investment through VBD 2 is estimated to double Nestlé Milo's production capacity per year. So in the future, the increase in production capacity is expected to encourage Nestlé Indonesia to become an export market for other countries, as well as to have a long-term positive impact on the Indonesian economy," Ganesan said in a separate statement.

On the other hand, the boiler utilizes the 8,880 metric tons of rice husks per year from the surrounding area to create steam, replacing the liquified petroleum gas (LPG). The company developed the boiler in collaboration with Tasma Bioenergy or Berkeley Energy Commercial Industry Services (BECIS). 

Nestlé Indonesia estimated the biomass boiler could reduce its greenhouse gas emissions by 6,068 tons of carbon dioxide equivalent (CO2e) per year and energy costs by 14 percent. The company distributed back the ashes from the boiler combustion to farmers to use as fertilizers. 

Ganesan said Nestlé Indonesia strengthened this commitment toward Net Zero emissions by 2050.

"We will also focus on supporting farmers and suppliers to develop regenerative agriculture, planting hundreds of millions of trees over the next ten years and completing the transition to using 100% renewable electricity by 2025," he said. 

The Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, Minister of Cooperatives and Small and Medium Enterprises Teten Masduki, and Karawang District Head Cellica Nurrachadiana, attended Tuesday's inauguration event. 

Luhut said he appreciated Nestlé's initiative in expanding investment in Indonesia. "The government continues to encourage the public as well as the business and industrial sectors to strengthen domestic production further to further increase Indonesia's economic growth, especially after the pandemic," he said. 

Teten praised the company's renewable energy initiative. "[T]he development and construction of a biomass boiler, moving toward a more renewable energy is a good step, especially since Karawang is indeed a rice producer so that the use of rice waste will also increase income for the welfare of farmers," he said. 

Indonesia has set a target to reach net-zero emissions by 2060. According to BP Statistical Review 2021, Indonesia emits about 575 million metric tons of carbon dioxide into the atmosphere in 2020, down 7.4 percent from a year earlier.

 

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