Indonesia Signs 15.6 Mln Kilolitres Biodiesel Allocation For 2025

Biodiesel allotment decree was waited for by industry

Indonesia had actually planned to release higher biodiesel mix on Jan. 1

Palm oil standard agreement increased 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 assigning 15.6 million kilolitres (KL) of biodiesel for 2025 circulation, while providing the industry up until the end of next month to adjust to the higher level of the fuel in the mix.

Indonesia, the world’s biggest exporter of palm oil, had prepared to introduce the mandatory requirement of 40% palm oil fuel in biodiesel on Jan. 1, up from 35% now.

“The ministerial regulation has actually been signed,” the minister Bahlil Lahadalia informed press reporters, including the was working to increase the necessary biodiesel mix to 50% next year.

Eniya Listiani Dewi, a ministry senior authorities, said biodiesel manufacturers and fuel sellers will be offered until Feb. 28 to adjust to the B40 mix. She said the delay was due to the fact that of technical obstacles linked to aids for the fuel.

The non-implementation on Jan. 1. had caused a 2.6% drop in the Malaysian palm oil standard agreement on Thursday. On Friday, it recuperated by around 1%.

Fuel merchants and biodiesel producers had said they were unable to draw up agreements for biodiesel circulation without the decree.

The biodiesel allowance for 2025 suggested an increase from 2024’s approximated biodiesel usage of 12.98 KL, ministry information revealed on Friday.

Of the total allotment for this year, 7.55 million KL is for the general public service commitment (PSO), which covers sectors such as public transportation, whose sales will be subsidised by the nation’s palm oil fund.

“The staying allocations will be sold at market value. The non-PSO allocation is set at 8.07 million KL,” Bahlil stated, adding the fund might not subsidise the rate gap between the palm oil and nonrenewable fuel sources for the overall allotment.

BPDPKS, the agency in charge of gathering and managing the palm oil funds, approximated in November B40 would require a 68% aid boost.

To help fund that, Indonesia prepares to increase its export levy for crude palm oil (CPO) to 10% from the present 7.5%, but for that to occur, another official regulation is required. (Reporting by Bernadette Christina Munthe, Fransiska Nangoy, Dewi Kurniawati; editing by John Mair, Savio D’Souza, Shri Navaratnam and Barbara Lewis)