East Kalimantan Environmentally Sustainable Development Strategy

29
Kalimantan’s shift to a climate-compatible development model. Each district will contribute
differently to these goals according to their emissions profiles and potential. Individual district
strategies are detailed in Chapter 4.
3. Sector strategies
East Kalimantan has significant opportunities to reduce its current emissions and increase its GDP.
For East Kalimantan, it is important to look at sustainable development strategies for each major
part of the economy and not just for the whole. This is partly because important stakeholders in the
province are grouped into different economic sectors (e.g., palm oil companies versus coal mining
companies) and partly because our government administration is organized by sector, such as
estate crops and forestry, as opposed to physical drivers of emissions such as deforestation. Once
each major economic sector has a sustainable development strategy we can engage stakeholders
on implementation. We hope that by having initiatives that both reduce the carbon footprint from
current activities and also increase GDP through higher value-add activities, the companies and
people working in that sector will support sustainable development as they will directly experience
the benefits.
This chapter reviews each of the sectors in order of their current business-as-usual situation, their
abatement opportunities, pilot projects, potential GDP improvements, and required policies (or
changes to policies) to enable the changes in each sector.
• Palm oil
• Forestry
• Agriculture
• Coal
• Oil and gas
PALM OIL SECTOR
This document analyzes palm oil separately from all other agricultural crops, as the palm oil sector 2 is
critically important for East Kalimantan’s economic growth and is also central to its CO2e emissions
profile and abatement opportunities.. Indonesia is the world’s largest producer of palm oil, yet East
Kalimantan has only recently begun its development of the sector. While palm oil accounts for less
than 1 percent of GDP currently, palm oil concessions are expanding rapidly. Palm oil is important
beyond its GDP contribution as it is one of the few highly profitable activities in rural areas, thus
bringing needed jobs and income to rural people and offsetting rural-urban inequality.
DRAFT
While the oil palm plant is highly efficient compared with other oil crops such as rapeseed, and
the actual process of planting, harvesting, and milling palm oil produces relatively few emissions,
the sector’s expansion into forest and peatlands is creating substantial emissions and has made
the palm oil sector the largest emitter in the province. We have identified initiatives to reduce more
than 60 percent of palm oil’s business-as-usual emissions, through a more efficient use of our
land base. Instead of area expansion into forested areas, economic development can be achieved
by agricultural intensification, better use of degraded lands, and by moving down the value chain
into palm oil refining. However, these changes require supporting policies, training, and financial
resources.
2 Palm oil describes the overall industry sector, while oil palm is used to describe upstream operations within
the plantations, such as cultivation of Elaeis guineensis