Indonesia to End Diesel Imports by 2026 through B50 Biodiesel Mandate

Government's Ambitious Energy Plan

Indonesia is set to eliminate diesel imports by 2026 through the implementation of the B50 biodiesel mandate, according to Minister of Energy and Mineral Resources Bahlil Lahadalia. The policy requires diesel fuel to contain 50% palm oil (CPO), marking a significant step in the country's energy strategy.

Evolution of Biodiesel Program

The biodiesel program was initiated in 2016 starting with B10, containing 10% CPO. The program has been progressively expanded to increase the CPO blend ratio. The government aims to completely stop diesel imports once the B50 mandate is fully implemented.

Impact on Diesel Importers

The shift to B50 will have significant implications for current diesel importers. Bahlil stated that achieving this target would mean the end of diesel imports by 2025, effectively ending the business for solar importers.

Supporting Domestic Palm Oil

One of the primary motivations behind the biodiesel mandate is to support domestic palm oil prices. By increasing the CPO content in diesel fuel, the government aims to create additional demand for palm oil, thereby boosting the domestic industry.