Volume VI, October 2013
Indonesia Business Council for Sustainable Development
From Editor in Chief Tiur Rumondang
IBCSD Participation on ASEAN Ministerial Meeting on Environment
Readers, We are pleased to bring you the 6th IBCSD Newsletter, October 2013 edition. This month we would like to shows IBCSD activities in participating an Exhibition as part of the ASEAN Ministerial Meeting in Surabaya promoting Sustainable Development, as well as the internal secretariat activity of one day Capacity Building program. This edition will also explore the example of responses on Sustainable Consumption and Production in countries around the world. On our best practice section, we want to show one of the energy initiatives by Sintesa Group on Clean Energy. Happy reading!
IBCSD WELCOMES NEW MEMBER COCA COLA AMATIL INDONESIA IBCSD announces that Coca Cola Amatil Indonesia (CCAI) has joined its membership on 30 September 2013. Coca Cola Amatil Indonesia (CCAI) is a leading manufacturer and distributor of non-alcoholic ready to drink beverages and has been operating in Indonesia since 1992. CCAI’s head office is in Sydney, Australia and it is listed on the Australian Securities Exchange. CCA, CCAI’s parent company, is one of Australia’s Top 20 listed companies. CCAI employs over 8,000 Indonesian nationals on a permanent basis and between 2,000 to 4,000 temporary staffs dependent on seasonality across the country. A significant number of external parties also derive their income from trading with CCAI. For sourcing raw materials, services and nonproduct related items CCAI has over 2,500 suppliers within its supply chain. The Company defines its commitment to sustainability into a holistic approach that is good for the environment, for the community, and for the people with focuses on THE WORLD WE ME (Water, Waste Management, Women, Community, Workplace, Active Healthy Leaving, and Responsible Marketing).
The Informal ASEAN Ministerial Meeting on the Environment (IAMME) 14th and the 9th Meeting of the Conference of Parties to the ASEAN Agreement on Transboundary Haze Pollution (COP-9) which hosted by Ministry of Environment of Republic of Indonesia aims to discuss issues related to co-operation in environmental sustainability, climate change, coastal and marine environment, water resources management, urban environmental management and governance, environmental education, as well as nature conservation and biodiversity among ASEAN countries. At the CO P - 9 , the AS E AN Environment Ministers reviewed the implementation and status of ratification of the ASEAN Agreement on Transboundary Haze Pollution and also reviewed the haze and fire occurrences in the region over the past year. Present on the meeting on the 23rd 24th September was the senior officials from ASEAN member countries on environmental program, followed by meeting on 25th- 26th for the Ministerial Meeting on the same issue. The delegates were from Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. The meeting also invited 3 partner countries which are China, Korea and Japan. The event also organized an exhibition presenting green products from companies, association, and related organizations which has breakthrough in creating environmental friendly business. The exhibition aimed to promote
Indonesian products implementing environment friendly practices. IBCSD as a CEO lead associations on sustainable development took part on the exhibition showing green p r o d u c t s f r om i t s m em b e r companies, whilst other exhibitors were ApFp -Peat, the ASEAN coopera ti on on Pea t la nd Conservation, EnviPlast, Clean Batik Initiative, Local government of Surabaya, and SGP-GEF. The products shown on IBCSD booth were the recycled paper from Indah Kiat & Tjiwi Kimia, and also paper from plantation fiber from RAPP. Palm Wax candle from Sintesa Group (Biolina) was also shown on the IBCSD booth together with Nickel stone and matte from Vale. The nickel is extracted in environmental friendly manner since it has the program on land reclamation, and also a water and air treatment program. Visitors who was mostly coming from ASEAN countries as a delegate or government officials were interested in knowing about IBCSD programs and initiatives. Suggestion to have a regular meeting among BCSD in ASEAN countries to exchange knowledge also came up from visitors.
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IBCSD Launches New Partnership for Sustainability on Energy and Water Collaborations through close and intensive partnership is one of the most efficient way in the modern age. Competitiveness often applies to many business profit orientation. However, the transition mode of Indonesia sustainability needs a shape in empowering interest group for bringing consciousness of future threat. The most participatory mechanism is a partnership for sustainable development and brings wider connection into the member’s scope. Thus, IBCSD builds necessary synergy with parties to work together in creating solutions for overcoming scarcity of energy and clean water. The initiative on energy and water saving in the business operation of a company is one of strategies that able to build significant change in the conservation era. Energy and water have a broader scope in various sectors of business and economic as it is also a significant driver of business wheel and even life cycle. Water is not less important than the energy as a main source of life and human activity. In many regions, water becomes a very valuable commodity. The over exploitation of energy and water will threat the scarcity of their availability. However, not many business players even realize their highly depend on these supplies only because they locate their business outside these sectors. Many businesses forget that they cannot success in the community that fails. In the development scale, energy and water could also represent the welfare and quality of life. Depletion of energy and water will significantly and directly impact the business Taking into account the maximum impact and outcomes, IBCSD collaborates with experts and long-time experience entities to implement the programs, given the limitation of the existing resources. Air Kita Foundation is an entities that has mission to drive social and economic progress by creating water partnership models, which was set up to transform the performances of Indonesian-based water utility companies, in an attempt to increase the potential for Indonesia to meet its Millennium Development Goal objective. The other IBCSD new partner is G-Energy, a Singapore Accredited Energy Service Company (ESCO), consultant and Singapore certified trainer specializing in providing Energy Audit, Green Building consultancy and training program related to energy efficiency and Green Building matter. In both partnerships, IBCSD want to develop strong connectivity between sustainability and efficiency that will bring the most fundamental business notion, which is profit. Considering the multiplying effect of promoting best practices, finance sector has to be involved and to play wider influence in sustainability initiative to bring better impact to the real sector.
Capacity Building for IBCSD Secretariat
Aware of the importance of IBCSD staff in understanding sustainable development issue, on 26 September 2013, IBCSD held a workshop for its own secretariat team. It was one day workshop explaining about sustainable development and role of IBCSD on local and global context. Ms. Tiur Rumondang, the IBCSD Executive Director, was the presenter and facilitator for the workshop. The workshop expecting that IBCSD secretariat will have a broader knowledge on sustainable development and deeper understanding on how the staffs could contribute, either individually or as a team, to sustainability through their daily tasks. The similar workshop is also available for employees of Member Company, which would give a better understanding how company with all employees could be part of sustainability initiative.
Volume VI, October 2013
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WBCSD Column
Policy and Voluntary Responses on Sustainable Consumption and Production*) Sustainable consumption and production becomes key issue on sustainable development agenda. With few exceptions, trends observed in earlier sections show resource use per capita rising with income albeit at different rates. Though the rate of increase may slow, somewhat as countries become more developed and their markets for material-intensive products become saturated, in very few instances has there been a “bending of the curve” to the point where resource use, emissions and waste actually begin to decline while incomes continue to rise. To make that happen requires more determined effort by all stakeholders. Governments have been using a number of measures; sustainable procurement; tighter efficiency standards for automobile, appliances, and new buildings; renewable energy portfolio standards and feed in tariffs for electricity; various subsidies to promote greener products and services; and in response to the economic crisis, green stimulus spending. One of the feasible things to do in pushing sustainable production agenda is through sustainable public procurement. As governments are large consumers of certain products, their purchasing preferences can shape the whole markets. Examples include: food, clothing, paper, electronic, equipment, motor vehicles, electricity, and buildings.
Sustainable Public Procurement United States: A 2007 Executive Order integrates and updates prior practices and requirements with the goal of increasing federal purchasing of energy efficient, recycled content, bio based, and environmentally preferable products and services. China: From January 2007, the central government and provincial government are asked to give priority to environment friendly listed in a “green product inventory”. Argentina: Argentina has developed an action plan to implement sustainable public procurement (SPP) and carried out research and training activities for procurement officials and policy makers with the support of the Marrakech Task Force on SPP. Mexico: The 2007-2012 National Development Plan created the scope for changes in procurement policy that allow for the incorporation of sustainability criteria. Recent changes in procurement law in Mexico include the requirement that all wood and furniture purchased by public agencies possess a certificate demonstrating its legal origin (since September 2007) and paper should have at least 50% recycled content. Republic of Korea: The Act on the Promotion of the Purchase of Environment Friendly Products passed in 2005, requires public agencies at national and local level to publish green procurement policies and implementation plans, carry out the latter, and report
results. Japan: the 2000 Law on Promoting Green Purchasing makes it compulsory for government institutions to implement green procurement, while encouraging local authorities, private companies and individuals to make efforts for purchasing environmentally sounds products and services. Canada: A Policy on Green Procurement issued in April 2006 requires that environmental performance considerations be embedded into the procurement decision-making process in the same manner as price, performance, quality and availability. European Union: By early 2007, 9 out of 26 EU member states had adopted national Green Action Plan, 5 had drafted a national action plan but it had not yet been adopted, 2 were in the process of preparing one. In Austria, Denmark, Finland, Germany, Netherlands, Sweden and the UK, 40 to 70% of all tenders published on Tenders Electronic Daily incorporated some environmental criteria, although in the remaining 18 countries, this figure was below 30%.
Sustainable Infrastructure and Buildings Finland: Sustainable Housing. The Finnish Government has been working since the mid 1990s to make construction more ecologically sustainable. PromisE is an itnernet based environmental classification system that has been developed to facilitate evaluations of the environmental properties of buildings in Finnish condition. South Korea: Green construction. In 2009 South Korea announced a green macroeconomic stimulus plan. These low carbon projects include developing railroads and mass transit, fuel efficient vehicles and clean fuels, energy conservation and environmentally friendly buildings. These measures alone will account for over 1.2 per cent of GDP, whereas the full stimulus plan involves investments of around 3 per cent of GDP. India: GRIHA. Green Rating for Integrated Habitat Assessment, is a building design evaluation system which aims to minimize the demand for renewable and non renewable resources by focusing on reduction water and energy consumption, limiting waste generation through recycling, and reducing pollution. GIRHA emphasize cost effectiveness and the integration of traditional heritage with scientific tools. South Africa: Sustainable Public Transport and Sport. The South African government is building a new sustainable public transport system for the 2010 FIFA World cup. It aims to produce measurable environmental benefits including an estimated 423,000tCO2 reduction in direct GHG emissions over a ten year lifespan, air quality improvement and reductions in ambient noise levels.
Volume VI, October 2013
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Policy and ‌..
Peru: Water for Everyone. Water for Everyone program includes 270 projects in the water and sanitation sector. The upgrading of water and wastewater plants in many parts of the country will ensure the provision of clean water and reduce the time spent in fetching water. The program will deliver potable water to some 49,000 beneficiary families, and sewer service to some 57,000 families. France: Energy Efficient Public Buildings. The goal of the French government is to reduce the energy consumption of existing building by at least 38% by 2020. To reach this goal France will start by 2012 the renovation of existing public building to reduce their energy consumption by 40 percent and their GHG emissions.
Eco Tax Measure The Netherland: In 2001, through its Environmental Action Plan, increased energy prices for small scale consumers by more than one-third by means of a tax levied on gas and electricity. Most of the tax revenues are redistributed to taxpayers through reductions in wage and income taxes, but a portion covers the cost of tax incentives for energy conservation measures. With the introduction of this tax, the price of household electricity has gone up by 15%. Finland: Finland was the first country to implement a CO2 tax in 1990, which today is among the highest in Europe. Germany: In 1999, Germany initiated its Ecological Tax Reform, gradually raising taxes on fossil fuels and electricity without increasing the overall tax burden. Electricity generated from renewable energy sources is exempt from the eco-tax, and electricity used by local public transport enjoys 50% tax reduction. Some of the revenue is used to provide advice to homeowners on reducing energy consumption and for grants to schools for solar heating, photovoltaic panels and biomass energy systems.
established to benefit the environment. Plastic bags are also taxed for example in Italy and Belgium, Taiwan and several Indian cities. Mexico: In 2002 the Mexican government introduced reforms to reduce residential electricity subsidies. Households consuming between 280 and 500 kWh bimonthly face a gradual and differentiated reduction in their electricity rate subsidy, while households that consume more than 500kWh will have the subsidy eliminated. The reduction in residential electricity subsidies is expected to generate revenues of 5 billion pesos. At the same time, a financial support programme will encourage the acquisition of more efficient refrigerators, air conditioners and insulation for consumers who live in hot regions. Chicago-US: In 2007 Chicago set a tax on bottled water, becoming the first major US city to impose such a surcharge. The bottled water tax applies to the retail sale of bottled water in the City at a rate of $0.05 per bottle. In addition to producing revenue that can be used to maintain the city’s water infrastructure, the tax is designed to encourage citizens to shift their hydration habits from bottled to tap water, which is essentially the same thing you get when you buy most bottled water brands. The tax also helps in reducing the number of plastic containers that wind up in landfills and reducing the greenhouse gas and other pollution created by trucking all that water to retail sites.
Voluntary Standards and Labels EU, Canada , and South Korea : Ecolabel. EU Ecolabel covers a wide range of products and service, with further groups being continuously added. Product groups include cleaning products, appliances, paper products, textile and home and garden products, lubricants, and services such as tourist accommodation. In Canada, Ecologo and Green Seal are the two North American eco -labeling programs approved by the Global Ecolabeling Network as meeting international recognized ISO 14024 requirements. In Korea, it aims to reduce consumption and resources and to minimize generation of polluting substances in each production step. It has been in place since 1992 and currently the scheme has 767 different categories of products such as batteries, wood products, beds and air conditioners.
China: China assesses levies on 29 pollutants in waste water, 13 industrial waste gases, and various forms of industrial solid and radioactive waste. Regulated substances include SO2, NOx, CO2, hydrogen sulphide, dust, mercury, and lead. Plants pay a fee for emissions greater than the regulatory standard for each substance, but when more than one pollutant exceeds the standard, Taipei, China: Energy Label. It was initiated by Bureau of plants pay only for the single pollutant which will result in Energy, Ministry of Economic Affairs, in 1992. Aims to the largest fee. evaluate the energy performance of products on the market. The efficiency criteria are then periodically Malaysia: Malaysia was one the first countries to use effluent charges, having introduced effluent fees, paired reviewed and revised to reflect the market conditions. with licensing, to control pollution from the palm oil industry as early as 1977. The regulation aims to reduce pollution in 42 rivers that were heavily polluted due to disposal of untreated effluents. A year after the imposition of the regulation, the pollution load fell more than half. Reduction in the pollution load decreased as well in the succeeding years. Ireland: In March 2002, Republic of Ireland became the first country to introduce a plastic bag tax, or PlasTax. Designed to rein in rampant consumption of 1.2 billion plastic shopping bags per year, the tax resulted in a 90% drop in consumption. To complete the win win scenario, approximately $9.6 million was raised from the tax in the first year, which is earmarked for a green fund
Singapore: The Green Label. It was launched in May 1992 by the Ministry of the Environment. As of January 2002, the programme applied to 29 product categories, covering a broad range of products, but excluding food, drinks, and pharmaceuticals, as well as services and processes. New Zealand: Environmental Choice. The New Zealand Ecolabeling Trust is a multiple specificatios based environmental labeling programme, which operates to international standards and principles, initiated and endorsed by the New Zealand Government in 1990. Australia: Good Environmental Choice. It is the only environmental labeling program in Australia which
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Policy and ‌.. indicates the environment performance of a product from a whole of product life perspective for consumer goods. United States: Energy Star . It is a joint voluntary program of the US EPA and the US Department of Energy which was started in 1992 to reduce greenhouse gas emission through energy efficiency.
Showing Countries with Voluntary Standards and Labels *) Resource: Trends in Sustainable Development. Towards Sustainable Consumption and Production, United Nations
Optimizing Waste of Natural Gas in Fulfilling Electricity Demand Sintesa Group—PT. Meppogen
To learn more about IBCSD membership, please contact: info@ibcsd.or.id.
Electricity demand in Indonesia continues to outpace supply growth. Indonesia has reached its ability to meet the rising energy needs. A World Bank report for 2011 ranks Indonesia 161st among 183 countries in the ease of businesses getting reliable electricity supply, down three places from the previous year.
Indonesia Business Council for Sustainable Development (IBCSD) Menara Duta Building, 6th Floor Wing B Jl. HR. Rasuna Said Kav. B-9 Jakarta 12910 T: +62 21 5290 1941-42 F: +62 21 5290 1949 www.ibcsd.or.id
To address the challenge, PT. MEPPOGEN, a subsidiary of Sintesa Group, started its business where generating and optimizing a renewable, green, and clean energy is embraced as a value of the company as a form of responsible business. Since the beginning, it has been operating as an environmentally friendly gas power plant, and further it establish itself to carrying the spirit of renewable and green energy through combined cycle power plant of the result of a combined cycle system, utilizing waste of natural gas which is considered more sustain. This project is considered as a more environmentally friendly due to the usage of natural gas instead of more polluted sources as the source of fuel. PT. MEPPOGEN has contributed in providing and supporting economic development since it has made a Power Purchase Agreement with PT. PLN on 11 October 2011 for capacity of 110MW with add on combined cycle system. Though it is not benefiting much recently, the initiative is believed will be more crisis proof, and will sustain the business in a long run.
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