Sustainable shift: How bioconversion can help ASEAN phase down coal while fueling ASEAN's economic growth

Coal-fired power plants (CFPPs) currently sit at the core of ASEAN’s energy mix. In 2023 alone, coal accounted for approximately 50% of ASEAN power generation, while also attributing to roughly 80% of the power sector emissions¹. The strong reliance on coal for power generation is driven by low cost, abundant availability in the region and the well-established processes and infrastructure. Coal also plays a strategic role ensuring stable and reliable electricity supply across ASEAN countries, amid growing electricity demand in the region and volatile global energy markets.

Therefore, an immediate coal phase-out across ASEAN is neither realistic nor economically desirable. The pressing question is: How can ASEAN achieve a responsible, economically viable phase-down of coal while safeguarding energy security and supporting continued economic development of the region?

Balance Economic Growth with Coal Phase-Down

Eight ASEAN Member States have committed to net- zero emissions: Brunei, Cambodia, Lao PDR, Malaysia, Singapore and Viet Nam by 2050, Indonesia by 2060 and Thailand by 2065.

In addition to net-zero goals, several countries have also set clear coal phase-out timelines: Malaysia by 2044, Thailand and Viet Nam by 2050, while Indonesia by 2056 with the aim to accelerate to 2050.

Viet Nam has taken a more prescriptive approach by mandating a long-term bioconversion strategy for its coal plants, requiring 20% biomass or ammonia co-firing after 20 years of operation, and up to 100% by 2050¹.

The policy intersects with a critical challenge: ASEAN operates one of the world’s youngest fleets of CFPPs, with an average age under 15 years¹. This means that the early retirement and closure of these assets would impose significant financial losses for the coal asset owners, whilst raising energy security concerns for ASEAN Member States.

Feedstock Variability is Critical to the Feasibility of Biomass Conversion

Within the ASEAN context for CFPPs, biomass co-firing offers a solution that addresses both cost considerations and energy security concerns, capitalising on ASEAN’s strong agricultural industry. Agricultural residue can be processed and utilised in biomass co-firing as biomass fuel, providing a cost-effective emissions reduction while also promoting a circular economy.

One of the key challenges in implementing biomass co-firing projects lies in the wide variability of feedstock characteristics and feedstock availability. The wide-ranging specific properties influence its applicability for bioconversion. Not all feedstock types are compatible with the existing boiler design and handling system for co‑firing, creating operational complexities for CFPPs.

This is why conducting an initial applicability assessment is essential. Such an assessment helps determine whether a current CFPP infrastructure is suitable for bioconversion. This will enable the client to evaluate the feasibility of the co-firing, identify potential risks and analyse the commercial opportunities before allocating further investment and funds to the project.

Ramboll offers a low‑cost 360° Bio Screening Study designed to help clients quickly provide an early feasibility assessment before funding is committed. For clients who move forward, Ramboll can conduct an in-depth technical study, which identifies the specific technical modifications required for successful and smooth biomass co-firing. This detailed analysis provides a clearer understanding of the associated CAPEX and OPEX implications and enables clients to make informed and confident investment decisions.

Bioconversion Success Stories in Denmark and Singapore

Avedore Power Station

Avedore Power Station, one of Denmark’s largest and most sophisticated combined heat and power (CHP) plants, was originally designed to operate on natural gas, coal and straw. As Orsted advanced its decarbonisation ambitions, wood pellet was identified as the preferred replacement fuel. Early wood pellet testing on Unit 2 began in the early 2000s. The increasing co-firing percentage of wood pellets revealed a range of operational and process challenges, e.g. pellet degradation, dust propagation, significant differences in combustion behaviour and lower energy density, etc. All these factors affected boiler stability and had direct implications on the plant’s Maximum Continuous Rating (MCR) and overall performance.

Ramboll supported Ørsted in addressing these challenges on Unit 2 initially, providing engineering expertise and support across fuel logistics, harbour infrastructure, process optimisation in ensuring operational reliability, flexibility and compliance with strict sustainability standards. Through continuous testing and technical adaptation, Ørsted and Ramboll successfully addressed the wide range of challenges. These efforts ultimately enable Unit 2’s main boiler to operate entirely on wood pellets while the secondary boiler fires 100% straw.

Building on this success, Unit 1 was subsequently identified for full wood pellet conversion. During this phase, a new challenge emerged: the single string conveyor system servicing both units was originally designed for coal and lacked the capacity to transport the significantly higher volume of wood pellets required, given the lower energy density of wood pellet. To address this, Ramboll conducted detailed 3D scanning of all transfer points and applied advanced 3D modelling to redesign and optimise the conveyor layout. This solution increased conveyor capacity within the existing infrastructure, enabling both units to operate on wood pellets without the need for costly equipment replacement.

As a result, Avedore is now one of the world’s most efficient biomass-based CHP plants, delivering heat to over 215,000 households and electricity for 1.3 million homes annually. With 91% energy conversion efficiency, the plant achieves exceptional fuel economy and major CO₂ reductions. This project showcased the possibility that legacy coal plants can transition to sustainable biomass fuels without compromising performance and without long down time.

RExus Bioenergy Plant

Ramboll served as Lender’s Technical, Environmental and Social Advisor (LTESA) for DBS in financing Singapore’s first large-scale circular biomass facility, RExus Bioenergy Plant. This pioneering 13 MW plant will convert construction and industrial wood waste into renewable energy.

Ramboll’s scope covered end-to-end technical, environmental and social due diligence, including technology assessment, site suitability, regulatory compliance, commercial agreements and financial input validation. Ramboll also evaluated environmental and social risks against local regulations and IFC Performance Standards, ensuring compliance with the Equator Principles and Asia Taxonomy for Sustainable Finance. By integrating technical and ESG expertise, Ramboll streamlined risk identification and reduced coordination complexity for the lender.

Thanks to the robust assessment, DBS approved green loan financing for the RExus Bioenergy Plant, with construction starting in early 2025. The plant will deliver 13 MW of renewable power, generate I-REC certified green electricity and supply Google’s data center through a 10-year virtual PPA with PacificLight Energy. Beyond energy generation, the facility addresses waste management challenges, promotes circularity through byproducts, and plans to integrate carbon capture in future phase.

The Long-Term Coal-to-Biomass Future

Biomass cofiring not only reduces near term emissions but also unlocks longer term opportunities. When combined with Carbon Capture, Utilization, and Storage (CCUS) as part of their decarbonisation efforts, the biogenic CO₂ captured, stored and utilised from biomass co-firing can help support ASEAN’s climate goals by reducing its carbon emissions from these CFPPs.

As the carbon market across ASEAN matures, biogenic CO₂ can also provide additional commercial revenue, enhancing the overall business case for co‑firing.

Evaluating CCUS feasibility in ASEAN requires understanding marginal abatement cost and the readiness of the CCUS value chain. These factors are crucial in ensuring a balance between emissions reduction and profitability of the operations. Ramboll brings extensive global experience in CCUS across multiple sectors and project phases, from feasibility study, technical due diligence and advisory services to supporting clients in making technically sound and commercially informed decisions.

A Regional Pathway That Balances Ambition with Reality

As ASEAN charts its path toward net zero, a nuanced understanding of the region’s energy landscape is essential. Rapid population growth, a young coal fleet, diverse agricultural resources and varying policy maturity mean that short to midterm practical strategies are necessary—alongside long term commitments.

Biomass cofiring and bioconversion present an immediate, scalable and cost-effective opportunity for coal-dependent markets to reduce emissions without compromising energy security or economic growth. These solutions also lay the foundation for future integration with CCUS, creating a viable pathway toward negative emissions as the region’s carbon market evolves.

Ramboll’s extensive global experience, combined with regional understanding of policy, resource availability and operational realities, positions us to support utilities, asset owners, government agencies and financial institutions in navigating this transition.

The shift away from coal will not happen overnight. But with targeted, technically robust, and region-specific strategies, ASEAN can make meaningful progress today while building the energy system it needs for tomorrow.

References:

¹ Southeast Asia Energy Outlook 2024 – Analysis - IEA