CATALYTIC
DEVELOPMENT GRANT PROPOSAL
Yogyakarta Integrated Green Gas
& Bio-CNG Project (Pilot Phase)
Submitted by:
PT Nurin Inti Global
Yogyakarta, Indonesia
Funding Request:
+/- USD 500,000
(Grant / CSR / Philanthropic Capital — open to multiple philanthropic
partners)
1.
Executive Summary
The Yogyakarta Integrated Green
Gas & Bio-CNG Project is a climate-positive, rural-based infrastructure
initiative designed to convert agricultural residues—primarily rice straw and
corn waste—into:
- Industrial gases (Nitrogen and Oxygen),
- Food-grade biogenic CO₂,
- Renewable Bio-CNG for transport and logistics,
- Organic fertilizer by-products,
while operating entirely off-grid,
without fossil fuels, and within a circular, non-extractive rural
development model.
The full-scale project requires
approximately USD 35 million in capital expenditure and is intended to
be financed by a consortium of private equity investors, strategic
industrial partners, and long-term infrastructure capital, including
industrial gas and clean energy companies.
However, as is typical for
climate-positive infrastructure in emerging markets, the primary constraint is not
long-term project economics, but early-stage development risk,
including:
- Secure land tenure,
- Environmental and local permitting (AMDAL),
- Farmer engagement and social license,
- Regulatory sequencing,
- Preliminary offtake alignment.
This proposal therefore seeks +/- USD 500,000 in catalytic philanthropic or CSR funding to
finance these essential early-stage activities.
This funding is expected to unlock
approximately USD 35 million in private capital, representing a leverage
ratio exceeding 1:70, and to position the project for Final
Investment Decision (FID).
The proposal is intentionally
structured to accommodate multiple philanthropic partners, each
contributing to a shared development outcome without dilution of impact or
mission alignment.
2.
The Problem: Agricultural Residues, Emissions, and Lost Rural Value
Indonesia produces tens of
millions of tons of agricultural residues annually, particularly from rice
and corn cultivation. In Yogyakarta and surrounding regions of Central Java,
post-harvest biomass is commonly:
- Openly burned,
- Left to decay unmanaged, or
- Utilized informally at negligible economic value.
These practices generate significant
negative externalities, including:
- Methane emissions and particulate matter (PM2.5),
- Deteriorating rural air quality,
- Health risks for farming communities,
- Missed opportunities for renewable energy and
industrial feedstock generation.
At the same time, the region faces:
- Structural undersupply of industrial gases,
- Rising logistics and transport fuel costs,
- Increasing regulatory pressure to decarbonize industry
and mobility.
Despite strong fundamentals, integrated
biomass-to-gas infrastructure remains underdeveloped, primarily due to
early-stage complexity involving:
- Land acquisition and zoning,
- Environmental approvals,
- Feedstock coordination across thousands of farmers,
- Community engagement and social safeguards,
- Multi-agency regulatory alignment.
These are precisely the risks that commercial
investors are least able to absorb upfront, even when long-term project
viability is strong.
3.
The Solution: A Non-Extractive, Low-Intervention Pilot Model
3.1
Deliberately Limited Physical and Social Footprint
The proposed pilot facility
processes approximately 280 tons per day of agricultural residues,
sourced from an estimated:
- 10,000 – 12,000 hectares of rice and corn farmland,
- Equivalent to 100 – 120 million m²,
- Representing less than 3% of total agricultural land
in Yogyakarta.
Key design principles include:
- No exclusive control over biomass,
- Only surplus residues beyond farmers’ existing needs are
collected,
- Farmers retain full autonomy over residue use.
Remaining residues continue to be
used for:
- Animal feed,
- Soil conditioning,
- Local construction materials,
- Traditional rural practices.
The sourcing model is voluntary,
non-exclusive, and socially neutral, ensuring:
- No disruption to food systems,
- No displacement of existing livelihoods,
- High community acceptance and long-term scalability.
4.
Farmer Participation & Reach (Revised Assumptions)
4.1
Farmer Landholding Assumption
For this proposal, farmer
participation is modeled using a realistic and impact-relevant landholding
size:
- Typical farmer-managed area:
10,000 – 15,000 m² per farmer (1.0 – 1.5 hectares)
This reflects:
- Semi-consolidated landholdings,
- Productive farming households rather than fragmented
microplots,
- Farmers already engaged in market-oriented agriculture.
This assumption ensures that income
impacts are material at the household level, rather than symbolic.
4.2
Estimated Number of Benefiting Farmers
Based on total sourcing area:
|
Total
Sourcing Area |
Average
Land per Farmer |
Estimated
Farmers |
|
100 million m² |
15,000 m² |
~6,700 farmers |
|
120 million m² |
10,000 m² |
~12,000 farmers |
Conservative participation range:
👉 6,500 – 12,000 farming households annually
Participation is voluntary and
seasonal, allowing farmers to adjust involvement year by year without
contractual lock-in.
5.
Rural Income Impact at Farmer Level
5.1
Total Annual Rural Income Distribution
Once operational, the project is
expected to distribute approximately:
USD 2.7 million per year
directly to farmers through residue
procurement.
This income is:
- Incremental (not replacing existing farm revenue),
- Derived from materials previously burned or discarded,
- Embedded in a commercially viable infrastructure asset.
5.2
Average Income per Farmer
Using the participation
range:
|
Farmers |
Average
Annual Income |
|
6,500 |
~USD 415 per farmer |
|
12,000 |
~USD 225 per farmer |
Expected range:
👉 USD 225 – 415 per farmer per year
Key characteristics:
- Earned post-harvest,
- No capital investment required,
- No debt or subsidy dependency,
- Paid against actual delivered volumes.
5.3
Income per Hectare
Expressed per hectare:
- USD 225 – 415 per hectare per year
This revenue is:
- Weather-independent,
- Not subject to commodity price volatility,
- Occurs during periods of high rural liquidity need.
6.
Why This Is Not Aid, Subsidy, or Charity
This model differs fundamentally
from traditional rural support programs:
- Market-based, not grant-based
- No farmer capital burden
- No land acquisition or exclusivity
- Environmental incentives aligned with income
Once enabled, no ongoing donor
funding is required.
7.
Why Philanthropic / CSR Capital Is Essential
Private investors require, at
minimum:
- Secure land tenure,
- Approved AMDAL and permits,
- Clear farmer engagement frameworks,
- Preliminary offtake alignment,
- Demonstrated social license.
These elements are developmental
public goods—essential, high-impact, but not monetizable upfront.
Philanthropic capital is uniquely
suited to absorb these risks and unlock commercial investment.
8.
Use of Funds (+/- USD 500,000)
Grant funding will be used exclusively
for development, not construction:
- Land securing & legal readiness
- Environmental & local permitting (AMDAL)
- Farmer & cooperative engagement
- Offtake & market validation
- Investment readiness & data room preparation
No funds will be used for shareholder
returns or asset acquisition.
9.
Expected Outputs (12–18 Months)
- Secured land tenure
- AMDAL approval
- Signed farmer frameworks
- Preliminary offtake MoUs
- Fully bankable investment package
Enabling:
- Final Investment Decision (FID)
- Equity consortium formation
- Construction financing
10.
Long-Term Impact
Environmental
- Methane and PM2.5 reduction
- Carbon-negative energy production
- Diesel displacement
Social
- Stable rural income
- Improved post-harvest practices
- Local employment
Economic
- USD 35 million private capital mobilized
- Replicable model for Indonesia & ASEAN
Over a 25-year operating life,
the project will inject USD 65–70 million directly into rural
communities.
11.
Alignment with Philanthropic & CSR Mandates
Aligned with:
- Climate mitigation & adaptation
- Circular economy
- Rural livelihoods
- Just energy transition
- SDGs 7, 8, 12, 13, and 15
Explicitly avoids:
- Land displacement
- Resource monopolization
- Extractive development
12.
Conclusion: A Catalytic Opportunity
This proposal does not seek
charity—it seeks partnership.
A one-time catalytic grant enables:
- Scalable climate action,
- Durable rural income,
- A bankable, long-life green infrastructure asset.
Contact
Ahmad Fakar
Independent Engineering Consultant
PT Nurin Inti Global
Email: afakar@gmail.com
Yogyakarta, Indonesia
