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Indonesia government raises mandatory level of biodiesel in fuel blending to 15%

JAKARTA (rambuenergy.com) – The Minister of Energy and Mineral Resources (ESDM) on Monday launched the implementation of mandatory utilization of 15 percent biodiesel B15) in every liter of diesel fuel to 15 percent from 10 percent previously.

The launching of the ruling was attended by stakeholders from the government, oil producers, biodiesel producers, fuel enterprises, automotive and heavy equipment manufacturers, observers and practitioners of biodiesel and related associations.

On Sept. 1, 2013 the mandatory use of biodiesel was set at 10 percent (B10). To realize the policy, the government sets biodiesel consumption in 2014 at 1.84 million kiloliters (kl).

Early this month (March), the government issued six policy packages to respond to the weakening of the rupiah against the US dollar. One of which was raising the bio fuel blending in diesel fuel to 15 percent.

To realize the policy, the government will absorb 5.3 million kiloliters of biodiesel or equivalent to 4.8 million tons of Crude Palm Oil (CPO). The government expects the mandatory biodiesel consumption will help the government to save foreign exchange amounting to US$2.54 billion.

Currently, the government is preparing a fiscal policy instruments in order to support the implementation of the mandatory biodiesel blending in order to ensure the supply of crude palm oil used as raw material for biodiesel.  (*)

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