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SEMS Research Highlights 2015: A New Strategy Development Model to Support FLNG Implementation in Indonesia
Floating Liquefied Natural Gas (FLNG), a relatively new technology in LNG industry, appears as billion dollars attraction to uncover the massive proportion of stranded natural gas reserves. Apparently, one-third of the gas reserves in the world are located in offshore, which in many cases considered to be stranded. As the growing interest to exploit and trade all available gas reserves along with the opportunity to build the offshore LNG facilities, the FLNG gives an ideal solution. FLNG is a natural gas liquefaction and storage system which is placed directly above the gas source using technology that is installed in a ship. The entire value chain of the FLNG will be shorter than the LNG supply chain in general, since it omits the transportation of natural gas via pipeline to onshore plants.
Despite its huge positive potential impacts offered, FLNG construction in Indonesia comprises number of risks and opportunities. One of major risks in the preparation to implement FLNG technology in Indonesia is how to meet the requirements of the local content percentage. In 2013, Indonesia’s Ministry of Energy enacted a regulation of minimum local content for equipment used in the energy industry. However, the current state of local industry capacity still requires significant new development in terms of technical, engineering, and security.
A coordinated effort between relevant actors to develop the industry of FLNG development, especially for the topside structure, is also in-line with the new focus of the Government on Maritime Sector Development. Therefore, a proper multi-actor roadmap is needed to address the complexity as well as ensuring that the overall strategies can be fully understood and well implemented by all relevant parties. This would allow the government to minimize the risk of delays in the implementation and achievement of the targets.
Technology Roadmapping is a method that has been used extensively to support the development of certain types of technology. Since this research took an industrial development for FLNG implementation as a focus of the study, the roadmap is considered appropriate because it has been widely used as a planning tool in some ministries in Indonesia. However, there is a saying that goes “planning without action is futile, action without planning is fatal”. We found that a roadmap is not enough to become a planning tool for the project in this type and scale.
We proposed the integration of Technology Roadmapping and Hoshin Kanri Strategic Deployment Management. Both methods have a similarity in the importance of interactions between stakeholders to support the development and deployment of strategies and policies. Hoshin kanri is incorporated in the roadmap making to provide a clear accountability arrangement and review of the strategies with the existence of clear documentation from planning to review stage.
The proposed integration model comprises four stages process including planning, visioning, strategy and roadmap development, as well as implementation and review. In the end, the planning process would produce two main outputs that become guides in the implementation of strategies. First, a roadmap that describe the strategic plan required at a certain time period. Second, an x-matrix that translates those strategies into tactics and detailed process to achieve each result or target.
This research has managed to find a novel approach to the development of the strategy, which is conducted by integrating the approach of Technology Roadmapping and Hoshin Kanri method and serves them as a strategic planning tool. We are integrating both methods to make a more detail strategy plan that includes strategy development, deployment to all parties, and a system of periodic reviews. To this extent, the research is believed could provide a novel implication by integrating the strengths of the two methods to provide the strategic framework for industrial development in the national sector.
This research is conducted by Akhmad Hidayatno, Aziiz Sutrisno, and Wulan Maulidiah
SEMS in collaboration with PT Makara Mas (Holding Company of Universitas Indonesia) conducted an introductory system dynamics workshop on modeling sustainable development for Fiscal Policy Agency – Ministry of Finance, Government of Indonesia. The workshop was part of Low Carbon Support, provided by the United Kingdom (UK) for the Ministry of Finance, especially the Centre for Climate Change Financing and Multilateral Policy (PKPPIM) in the Fiscal Policy Agency. PKPPIM are tasked to recommend a low carbon fiscal policies especially starting from the national budget 2015. This is why they needed a more integrated modeling tool to be able to evaluate green fiscal policy impacts.
FPA has already a strong group of economic models that are based on IO Models, SAM, and CGE, however since the questions of green policy is multi-dimensions with multi-sectoral approach, they feel that they need to have a more adaptive model to answer these questions.
The workshop was conducted for 5 days in the 2nd week of February, ranging from the basics of systems thinking and system dynamics, group dynamics, simple model building and closed by discussion on future models development of a new “green fiscal policy” model.
SEMS Laboratory is developing a model to evaluate the energy impact on land transportation strategy for the Dewan Energi Nasional (DEN – National Energy Council). The model is based on System Dynamics, therefore we kick off the model development by conducting an introductory one-day workshop on System Dynamics Modeling.
Our researcher, Aziiz Sutrisno, lead the workshop aims to give a foundation for the council’s expert to understand the SD “engine” of the model.
Pak Akhmad was invited to become one of the speakers in the international workshop on Modeling Inclusive Green Economies, which jointly conducted by United Nations Environmental Protection (UNEP) University of Bergen (UiB), and the Millennium Institute. This workshop is part of PAGE initiatives that was formulated to follow on RIO+20. The partnership for Action on Green Economy (PAGE) drives a multi-stakeholder and participatory approach to create inclusive, sustainable societies. PAGE is driven by a collaboration of UN institutions regarding inclusive green economy between UNEP, International Labor Organization (ILO), United Nations Industrial Development Organization (UNIDO), United Nations Institute for Training and Research (UNITAR)
The two-days seminar discuss about different modeling approach on inclusive green economy, such as IO model, CGE Models, ILO Models for defining Green Jobs, Spatial Modeling, Bio-Physical Modeling and of course System Dynamics, which primarily focus on the T21 Model developed by the Millennium Institute. It also discuss about country case studies from Africa, South America and Asia. For Asia, the representatives are from Indonesia, Thailand and China. The workshop was held in the Universitetet i Bergen, 7-8 May 2013.
Mr Akhmad presentation on the modeling of REDD+ Impacts on the Palm-oil based Biodiesel Industry in Indonesia sparked interest and many questions from the audiences at the final session of day 1. REDD+ in Indonesia is partially supported by the Norwegian government and palm oil plantation in Indonesia is considered one of the main reasons for deforestation, therefore the topics was very well accepted.
President’s Delivery Unit for Development Monitoring and Oversight (UKP-PPP) in collaboration with the School of Business and Management ITB (SBM ITB) has conducted “The 2nd International Workshop on Systems Modelling: System Analysis and Modelling for Green Economy”. The main keynote speaker is Professor Dr. Pavel Kabat, the Director & CEO of International Institute for Applied Systems Analysis, Austria. IIASA is an international research organization that conducts policy-oriented research into problems that are too large or too complex to be solved by a single country or academic discipline.
As an invited presenter, Pak Akhmad presented his on going research “Modeling the impacts of Indonesia’s REDD+ Initiatives to the Biodiesel Targets in the Green Economy Framework using System Dynamics”.