Developing a Sustainable Business Model for Bio-Propylene Glycol Based on Crude Glycerol in Indonesia
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Indonesia remains dependent on imported propylene glycol despite the availability of crude glycerol from the biodiesel industry, creating an opportunity for domestic low-carbon chemical production. This study aimed to develop and evaluate a sustainable business model for crude glycerol-based bio-propylene glycol production at PT Kilang Pertamina Internasional. The study developed a Business Model Canvas and an Operating Model Canvas, integrated them with the Triple Bottom Line framework, assessed financial feasibility using discounted cash flow analysis, conducted sensitivity analysis, and validated the model through site visits, stakeholder discussions, and focus group discussions. The 30,000-ton-per-year Balongan project demonstrated financial feasibility, generating a net present value of USD 49.8 million, an internal rate of return of 18.14%, a profitability index of 1.50, and a discounted payback period of 10.87 years. Product selling price, crude glycerol price, and capital expenditure were identified as the most influential variables affecting project feasibility. Integration with the existing Balongan refinery could improve utility utilization and operational efficiency, while the proposed model could create economic value through import substitution, social value through employment generation, and environmental value through waste valorization. The study concluded that the project was strategically promising, provided that PT KPI secured long-term feedstock supply, prospective offtakers, technology transfer, investment efficiency, and workforce readiness to support successful and sustainable commercial implementation.
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