Key insights and market outlook
The Indonesian government plans to replace Liquified Petroleum Gas (LPG) with Dimethyl Ether (DME) for cooking purposes, aiming to reduce LPG imports. Current LPG consumption is 10 million tons/year, while domestic production is only 1.6 million tons, resulting in 8.4 million tons of imports. DME can utilize existing LPG infrastructure and is considered more environmentally friendly, producing 20% less greenhouse gas emissions.
The Indonesian government is planning to substitute Liquified Petroleum Gas (LPG) with Dimethyl Ether (DME) for domestic cooking needs. This decision is driven by the significant gap between national LPG consumption and domestic production. Currently, Indonesia consumes around 10 million tons of LPG annually, while domestic production only meets 1.6 million tons of this demand, resulting in 8.4 million tons of LPG imports valued at hundreds of trillions of IDR 1
DME is considered a viable substitute for LPG due to its similar chemical and physical properties. The Ministry of Energy and Mineral Resources (ESDM) highlights that DME can utilize existing LPG infrastructure, including cylinders, storage facilities, and handling equipment. A mixture of 20% DME and 80% LPG can be used in existing gas stoves without modification. Moreover, DME can be produced from various energy sources, including renewable biomass, waste, and Coal Bed Methane (CBM), with low-calorie coal currently considered the most feasible feedstock for DME production in Indonesia.
The shift to DME is also motivated by environmental benefits. DME has a lower calorific value (7,749 Kcal/Kg) compared to LPG (12,076 Kcal/Kg), but its higher density compensates for this difference. More importantly, DME is considered more environmentally friendly as it is easily decomposed in the atmosphere, does not harm the ozone layer, and can reduce greenhouse gas emissions by up to 20% compared to LPG. The use of DME can decrease CO2 emissions from 930 kg to 745 kg per year. Additionally, DME combustion produces a more stable blue flame, does not generate particulate matter or NOx, and is sulfur-free.
While DME production facilities are not yet established in Indonesia, the Ministry of ESDM is committed to developing the necessary technical capabilities for both production and utilization of DME. The ministry plans to initiate the transition process this year, although specific timelines and implementation details are still being finalized.
The transition to DME presents both challenges and opportunities for Indonesia. While it reduces dependence on LPG imports and potentially lowers greenhouse gas emissions, it also requires significant investment in DME production infrastructure. The successful implementation of this plan could position Indonesia as a leader in clean energy transition in the region.
DME Implementation Plan Announcement
LPG Import Reduction Strategy