Indonesia will mandate gasoline containing ethanol blends beginning in 2027,according to a statement from โa โขgovernment minister,marking a meaningful step toward reducing reliance on fossilโค fuels and โbolstering the country’s biofuel industry. The policy aims toโค lower carbon emissions and increase demand for locally producedโค ethanol, primarily derived from sugarcane andโ cassava.
The move comes as Indonesia seeks to diversify its energy sources and meet its commitment to achieving net-zeroโ emissions byโ 2060. The mandatory โขblending will initially impact โmajor โฃcities and gradually expand nationwide, possiblyโฃ affecting millions of vehicle owners and the country’s fuel import bill. The initiative is expected to stimulate investment in ethanol production facilities and create new economic opportunities for farmers.
Energy and Mineral Resources Minister โขarifin Tasrif announced the plan, statingโ the government is finalizing regulations to ensure a smooth transition. “We are targeting 2027 for the implementation ofโข mandatory bioethanol blending,”โ Tasrifโข said. He did not specify theโข initial blend percentage but indicated it would be determined based on supply availability and infrastructure readiness.
Indonesiaโค currently has a voluntary ethanol blending program, but uptake has โคbeen limited due to factorsโ including production costs and infrastructure constraints. The mandatoryโฃ policyโฃ is intendedโค to overcome these hurdles by creating a guaranteed market for ethanol producers. The government is also exploring incentivesโค to encourageโข investment in ethanol โขproduction and distribution.
The initiative aligns with global trends toward biofuel adoption, driven by concerns about climate change and energy security. Several countries, including Brazil and the United States, already have mandatory ethanol blending programs. Indonesia’s move could further accelerate the growth of โคthe biofuelโ industry in Southeast Asia.
