Simulation of tipping fee policy to support municipal waste management into alternative fuel in the cement industry: a case study of Tuban landfill Indonesia

Abstract

Refused Derived Fuels (RDF) alternative energy materials from municipal waste are alternative materials needed by the cement industry to substitute coal. Apart from the fact that RDF products have high heat, RDF prices are more economical than coal. RDF production is also able to solve municipal solid waste (MSW) problems and reduce CO2 emissions. In Indonesia statute no. 18, 2008, concerning waste management, it has regulated a tipping fee or compensation from the government to process costs per ton of waste. However, not many governments in cities in Indonesia have determined the value of this compensation. The purpose of this study is to simulate a tipping fee policy to support municipal solid waste management as an alternative material for RDF in the cement industry. This research’s case study is municipal solid waste management in Tuban, a cement plant in Tuban. Method stages This research was carried out by making a feasibility study model at the RDF Plant in Tuban. Next, a simulation of the number of tipping fees should be spent. The simulation results will be compared with project feasibility indicators such as NPV, IRR, payback period, and BCR. The results showed that tipping fees were needed to support project sustainability. It was suggested that with the maximum investment of 5 billion Rupiah, the minimum tipping fee is 70 thousand Rupiah per ton for processing 120 tons MSW per day. That should be supported by the sale of a by-product of RDF production in the form of fertilizer.