Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025
Biodiesel allowance decree was waited for by industry
Indonesia had planned to introduce greater biodiesel mix on Jan. 1
Palm oil benchmark agreement rose 1% after previous fall
Government goes for 50% biodiesel mix in 2026
(Recasts with energy minister’s comment)
By Bernadette Christina and Fransiska Nangoy
JAKARTA, Jan 3 (Reuters) – Indonesia Energy and Mineral Resources Minister signed a decree on Friday assigning 15.6 million kilolitres (KL) of biodiesel for 2025 circulation, while offering the market until the end of next month to adapt to the greater level of the fuel in the mix.
Indonesia, the world’s largest exporter of palm oil, had planned to release the necessary 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 informed reporters, adding the federal government was working to increase the mandatory biodiesel mix to 50% next year.
Eniya Listiani Dewi, a ministry senior official, said biodiesel manufacturers and fuel sellers will be given till Feb. 28 to adapt to the B40 mix. She said the delay was since of technical difficulties linked to subsidies for the fuel.
The non-implementation on Jan. 1. had actually caused a 2.6% drop in the Malaysian palm oil standard agreement on Thursday. On Friday, it recovered by around 1%.
Fuel merchants and biodiesel manufacturers had stated they were unable to prepare contracts for biodiesel circulation without the decree.
The biodiesel allotment for 2025 indicated a boost from 2024’s estimated biodiesel consumption of 12.98 KL, ministry data revealed on Friday.
Of the overall allowance for this year, 7.55 million KL is for the general public service responsibility (PSO), which such as public transportation, whose sales will be subsidised by the country’s palm oil fund.
“The remaining allotments will be sold at market value. The non-PSO allocation is set at 8.07 million KL,” Bahlil stated, adding the fund could not subsidise the price gap between the palm oil and fossil fuels for the general allowance.
BPDPKS, the agency in charge of gathering and managing the palm oil funds, estimated in November B40 would require a 68% aid boost.
To assist fund that, Indonesia prepares to increase its export levy for crude palm oil (CPO) to 10% from the existing 7.5%, but for that to take place, another main policy is needed. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati; editing by John Mair, Savio D’Souza, Shri Navaratnam and Barbara Lewis)
