Jakarta: Indonesia is accelerating its biofuel programme after raising the mandatory palm-based biodiesel blend to 50% in July, with the government now pursuing broader expansion of domestic biofuel use to reduce fuel import dependence and strengthen energy security, Bloomberg reported.
The biodiesel push forms part of President Prabowo Subianto’s wider strategy to increase the use of domestically produced renewable fuels. The government is also preparing to sharply increase ethanol blending, but biodiesel remains a major component of Indonesia’s biofuel policy.
Indonesia raised its mandatory palm-based biodiesel blend to B50 in July, requiring diesel fuel to contain 50% palm-based biodiesel. The move has significantly increased domestic demand for palm oil as a fuel feedstock and strengthened the country’s focus on biofuels as an alternative to imported fossil fuels.
The government’s broader biofuel strategy comes amid renewed concerns over energy security and international oil market volatility. Officials are seeking to expand domestic production of crop-based fuels while supporting the agricultural sector.
Alongside the biodiesel programme, Indonesia is preparing to double its 2028 bioethanol blending target to 20%, from the earlier E10 target. Authorities are planning around 2 million hectares of sugarcane cultivation across Java, Sumatra, Kalimantan and Papua to support the ethanol programme.
The expansion of both biodiesel and ethanol is expected to increase demand for domestic agricultural feedstocks. While palm oil is the primary feedstock for Indonesia’s biodiesel programme, sugarcane is being positioned as the main feedstock for the planned expansion of ethanol production.
The government has also been working to improve sugarcane productivity, including plans to replant 298,000 hectares of ageing plantations, improve irrigation and upgrade sugar mills. It has earmarked 9 trillion rupiah (around US$507 million) to improve plantation yields, including through higher-yielding planting material.
Indonesia’s experience with biodiesel is also influencing its approach to ethanol. Energy Ministry official Eniya Listiani Dewi said the government plans to progressively increase ethanol blending, with a long-term ambition of reaching E50.
The expansion of biodiesel and ethanol reflects Indonesia’s broader effort to reduce reliance on imported fuels by increasing the contribution of domestically produced biofuels to its transport energy mix.
