Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
Biodiesel allocation decree was waited for by industry
Indonesia had prepared to launch greater biodiesel mix on Jan. 1
Palm oil criteria contract rose 1% after previous fall
Government aims for 50% biodiesel mix in 2026
(Recasts with energy minister’s remark)
By Bernadette Christina and Fransiska Nangoy
JAKARTA, Jan 3 (Reuters) – Indonesia Energy and Mineral Resources Minister signed a decree on Friday allocating 15.6 million kilolitres (KL) of biodiesel for 2025 distribution, while providing the industry till completion of next month to adjust to the greater level of the fuel in the mix.
Indonesia, the world’s largest exporter of palm oil, had prepared to release the obligatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.
“The ministerial regulation has been signed,” the minister Bahlil Lahadalia told press reporters, including the federal government was working to increase the obligatory biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior authorities, said biodiesel manufacturers and fuel merchants will be given till Feb. 28 to adjust to the B40 mix. She stated the hold-up was because of technical difficulties connected to subsidies for the fuel.
The non-implementation on Jan. 1. had actually caused a 2.6% drop in the oil standard agreement on Thursday. On Friday, it recuperated by around 1%.
Fuel retailers and biodiesel producers had stated they were unable to draw up agreements for biodiesel distribution without the decree.
The biodiesel allowance for 2025 suggested a boost from 2024’s approximated biodiesel consumption of 12.98 KL, ministry data showed on Friday.
Of the overall allowance for this year, 7.55 million KL is for the public service obligation (PSO), which covers sectors such as mass transit, whose sales will be subsidised by the country’s palm oil fund.
“The remaining allowances will be cost market value. The non-PSO allowance is set at 8.07 million KL,” Bahlil said, adding the fund could not subsidise the rate space between the palm oil and nonrenewable fuel sources for the general allotment.
BPDPKS, the company in charge of collecting and handling the palm oil funds, approximated in November B40 would need a 68% aid boost.
To help fund that, Indonesia plans to increase its export levy for crude palm oil (CPO) to 10% from the current 7.5%, however for that to happen, another official policy is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati; editing by John Mair, Savio D’Souza, Shri Navaratnam and Barbara Lewis)