Indonesia’s Energy and Mineral Resources Ministry intends to increase and expand the country’s national biodiesel mandate in order to cut fossil fuel imports and boost the consumption of palm oil.
The ministry was looking to allocate 3.46bn litres for biodiesel in 2018 – up from the previous year’s estimated 2.89bn litres – and expand the biodiesel mandate to cover the train sector from May and the mining sector from July, Reuters said on 3 April.
The increased biodiesel usage was intended to reduce Indonesia’s dependence on foreign oil, slash greenhouse gas emissions and use up some of the world’s largest palm oil producer’s surplus production.
The transportation and power sectors already had a B20 (20% biodiesel blend) mandate in place, and the new rules would set a B5 and B10 mandate for the rail and mining sectors, respectively.
The energy ministry document seen by Reuters also included a provision to increase the amount of biodiesel allocated to the state-owned energy firm PR Pertamina and privately-held PT AKR Corporindo to 1.47bn litres from the previous 1.41bn litres for the May to October period.
In 2015, Indonesia imposed an export tax of US$50/tonne on crude palm oil and US$30/tonne for processed palm oil products and used part of the tax revenue to subsidise its biodiesel industry, Reuters wrote.