RI to accelerate B30 program in anticipation of EU restrictions

28 March, 2019 | Source: The Jakarta Post

The government has said Indonesia will accelerate the mandatory use of 30 percent blended biodiesel ( B30 ) in anticipation of the European Union’s move to ban palm oil-based biofuel in its member countries.

Its mandatory use was set to take effect in 2020 but it was brought forward to September in response to the drafting of the EU’s Renewable Energy Directive (RED) II that was prepared by the European Commission. It is currently being debated by EU leaders.

Indonesian Oil Palm Estate Fund (BPDP-KS) head Dono Soestami said in Jakarta on Wednesday that the policy was needed because the country needed to expand the domestic market for palm oil and its derivative products.

“We will use B30 in September or October 2019, starting with 30,000 kiloliters or 50,000 kl. The most important thing is that we have to start,” Dono added as quoted by kontan.co.id.

Indonesia introduced the mandatory use of 20 percent blended biodiesel ( B20 ) in September last year and the government is also studying the possibility using B100.

With the mandatory use of both B20 and B30, the domestic market is expected to absorb 9 million tons of crude palm oil (CPO).

Last year, Indonesia exported 34.71 million tons of CPO from 32.18 million tons the previous year, according to the Indonesian Palm Oil Association.

Dono suggested that the green fuel program was expected to absorb some 25 million tons of CPO in 2025. He said without an effort to expand the absorption of CPO in the domestic market, the oversupply of the commodity would reach 55 million tons in 2025.

 

The Indonesian government plans to issue savings sukuk (Islamic bonds), series ST007, to expand the base of retail investors in the domestic financial market and finance green projects in the state budget (APBN).
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