SUSTAINABILITY Volume 11 - January 2016 v Musim Mas is 100% Training smallholder farmers RSPO-certified (p8-9) (p4) Beyond traceability Musim Mas joins POIG (p5) (p10-11) Landscape Approach and green development (p6-7) From methane capture to national grid (p2-3) Since 2010, Musim Mas has embarked on the installation of methane capture facilities as a standard feature for all of its 13 From Dear Reader palm oil mills with a total budget When we first announced our Sustainability Policy in of close to USD 50 million. To- December 2014, we did not anticipate the domino effect that date, Musim Mas has completed would follow from our policy actions. Fast forward to January nine such projects, making it the methane capture 2016, we are gaining momentum to transform the industry into an interesting model of sustainable development. Group with the largest number of methane capture facilities in We are channelling our biogas-powered electricity to the the palm oil industry. national grid, providing electricity to communities in rural to national grid Indonesia. ("From methane capture to national grid", p2-3). lectricity is the linchpin of modern life: effluent (POME), which is 34 times more With increased rural electrification, opportunities, among others. mobile phones, computers, light bulbs and potent than carbon dioxide (CO2). With the benefits for the rural population We are encouraging our customers to think beyond practically everything in the modern world an average saving of 430kg CO2 per are transformational: more computers The electricity generated by palm oil mills traceability, to initiatives that will yield practical results on the Eruns on electrical power. Access to energy is crucial ton of palm oil produced, the Group will for schools, more medical equipment should be promoted as another form of ground. ("Beyond traceability", p5). to achieving poverty alleviation, health, education, stand to save a total of about 250,000 for clinics, pumps for water as well as renewable energy to reduce the carbon FOREWORD equality and environmental sustainability. However, tons CO2 equivalent a year. sanitation and more income-generating footprint of palm oil operations. We are pushing for the landscape approach, as the next step one-third of Indonesia's 250 million-strong population beyond our traceability work. ("Landscape approach and still lives off the grid. In rural areas, stand-alone power Since 2010, Musim Mas has embarked Mills with green development", p6-7). biogas plant generators such as the diesel generator are the on the installation of methane capture that is linked dominant technology. facilities as a standard feature for all of Our work on independent smallholders, in joint partnership to the grid its 13 palm oil mills with a total budget of with the International Finance Corporation (IFC), has started Palm oil mills can provide solution to increase close to USD 50 million. To-date, Musim Pekanbaru with the commencement of the farmers' training. ("Training Kalimantan Sumatra rural electrification and at the same time reduce Mas has completed nine such projects, Sumatra smallholder farmers", p8-9). greenhouse gas emissions. making it the Group with the largest Padang number of methane capture facilities On another note, we joined the Palm Oil Innovation Group Palangkaraya In 2014, the Group sponsored and built the in the palm oil industry. The methane (POIG), the first palm oil major to join the prestigious coalition infrastructure that connects to the rural electrical capture facilities for the remaining formed by heavy weight NGOs and progressive companies. network, making Musim Mas an energy producer - four operating mills are now under ("Musim joins POIG", p10-11). Biogas Plant significant for remote areas where palm oil mills are construction and will be completed National Grid typically located and where electrical infrastructure within the next year. We are also pleased to announce that we are 100% certified for is limited. Six of the Group's mills are connected to all our new acquisitions too, as promised in our Sustainability the grid and plans are underway for more mills to The electricity generated by Musim Mas 1 mwh Policy ("Musim Mas is 100% RSPO-certified", p4). develop the infrastructure. mills, besides providing 24-hour utilities Produces for all the workers and their families 0.18 I hope you enjoy reading this issue of our journal. 1,600 rural kwh Musim Mas' electrical power runs on the back of the living in the plantations, also goes to householdsBenefits more than energy-positive palm oil mills that it operates on the the surrounding local communities. On islands of Sumatra and Kalimantan. Palm oil mills in average, 1 megawatt of excess electrical Indonesia are self-sufficient in energy with the use power can be generated by one mill, 0.225 Executive Chairman 0.156 kwh of their by-products (biomass) as fuel to generate benefiting some 1,600 households kwh Musim Mas Group electricity. directly. 0.035 kwh With additional capital investment, the mills can go If such endeavor by Musim Mas can be 0.005 further to reduce emissions by installing methane expanded to the hundreds of mills across kwh capture facilities to collect the waste gas - methane Indonesia, more rural households will be - as another source of fuel (biogas). Methane is a by- able to benefit and reduce their reliance product of the anaerobic digestion of palm oil mill on diesel. Total 0.601 kwh Based on electrical appliance electrical rating from Energy use calculator1 and Energy.Gov2 1http://energyusecalculator.com/calculate_electrical_usage.htm 2http://www.energy.gov/energysaver/estimating-appliance-and-home-electronic-energy-use p2 p3 Musim Mas is 100% RSPO-certified ustomers are for local communities with vulnerable concession maps of RSPO members livelihoods. The Group believes that will be publicly available. Besides, usim Mas has always been ways to promote sustainability ecological and social values. starting to realise the best way forward is not just to through the Indonesia Palm Oil Pledge a firm believer in RSPO*. In implementation of the industry. that paying stop purchasing from errant suppliers. (IPOP), the Group has a Memorandum 2009, not only was the Group Globalisation and climate change Musim Mas believes that RSPO standard Mplantation the first in Indonesia to be discussions have arguably established still provides the most effective means to Cattention to the most The optimal approach hinges on of Understanding (MoU) with the World RSPO-certified, it also became the first an economic rationale to sustainable properly evaluate and monitor all palm vulnerable spots in their empowering suppliers and the local Resources Institute to support the Riau major group to attain 100% certification production standards. As the world's oil production and development and supply chain is not good communities through initiatives that OneMap initiative - efforts that will be for all its plantation in 2012. Its scheme most efficient oil crop, palm oil is should be made the universal standards effectively address their unique set favourable for conserving the Tesso smallholder plantations (KKPA) here to stay. Production and use of for the industry. enough; it is about the of challenges. In the North Sumatra Nilo National Park through clarity of were also the first to achieve RSPO sustainable palm oil will enhance actual impact on the region, the Group is implementing ownership and responsibility. certification in 2010. ground. an independent smallholder project, RSPO-Certified Area aimed at improving their livelihoods Notably, there was a debate at the Following the Group Sustainability through a customised curriculum that workshop regarding how realistic it First While traceability as a risk management Policy announced in 2014, Musim Mas Certified Area Company Area Certification will be replicated elsewhere upon its is for the Group to target end 2016 further commits to achieving RSPO (Ha) tool has aided the progress in Date success. for completing its plantation - level certification for all its new acquisition. identifying and sieving out errant Batang Kulim Palm Oil Mill 11,128.30 traceability and indeed the relevance This implies that not only will Musim suppliers, it is but a stop-gap measure 1 Scheme Smallholders (KKPA) 864.00 6 Jan 2009 Along with the industry, Musim of such exercise in the pursuit of Mas not acquire any plantation that in the wider context or at best a basis Village Oil Palm Development (Kas Desa) 12.00 Mas is working to address concerns sustainability. The completion of does not conform to RSPO standard, for pursuing further action on the PT Musim Mas on the issues of transparency and traceability to the plantation would it takes upon itself the mission to Pangkalan Lesung Palm Oil Mill 12,424.12 ground. The industry is recognising accountability. Customers at the ultimately depend on the verification transform its acquisition into a fully 2 Scheme Smallholders (KKPA) 802.00 6 Jan 2009 that real impact involves an entire slew certified plantation within a relatively workshop further raised queries such work undertaken by independent Village Oil Palm Development (Kas Desa) 5.00 of socio-economic endeavours, and is short span of time. A case in point is as the availability of the Group’s verifiers. With the dialogue going Agrowiratama Palm Oil Mill 5,915,29 moving from dialogues on tracing palm PT Guntung Indamannusa (PT GIN), an 3 PT Agrowiratama 17 Jun 2010 concession coordinates. As a beyond traceability, Musim Mas will Scheme Smallholders (KKPA) 1,524.00 oil to focusingEmissions on creating net socio- acquisition at end 2013. In June 2015 committed member of the RSPO, by also be channelling greater efforts on environmental benefits. - well within the deadline - PT GIN Berkat Sawit Sejati Palm Oil Mill 10,818.03 4 PT Berkat Sawit Sejati 8 Apr 2010 extension, Musim Mas’ concession landscape level initiatives where the successfully passed the RSPO audit for (Kas Desa) Village Oil Palm Development 5.00 maps are also made public.