The government plans to accelerate bioethanol production by encouraging private investment and revising regulations to support nationwide E20 fuel blending.
Indonesia is opening the door for private companies to build bioethanol plants as the government seeks to accelerate the rollout of gasoline blended with 20% bioethanol (E20) by 2028.
Director General of New, Renewable Energy and Energy Conservation (EBTKE) at the Energy and Mineral Resources Ministry (ESDM), Eniya Listiani Dewi, said private sector participation will be essential to expanding domestic bioethanol production and meeting the government’s blending target.
According to Eniya, the policy direction is being incorporated into revisions to Presidential Regulation No. 40 of 2023 on accelerating national sugar self-sufficiency and bioethanol supply for biofuel production.
The revised regulation is expected to provide the legal framework for increasing ethanol blending ratios in transportation fuels while supporting investment in domestic production capacity.
The Energy Ministry is coordinating with the Coordinating Ministry for Economic Affairs, which is leading the regulatory revision, to ensure the policy aligns with President Prabowo Subianto’s directive to accelerate bioethanol development.
Eniya said construction of a bioethanol plant could be completed in approximately 1.5 years, although project implementation will depend on the availability of sufficient domestic feedstock.
President Prabowo previously announced plans to develop between 30 and 50 bioethanol plants nationwide to expand Indonesia’s biofuel industry and reduce reliance on imported fossil fuels.
Despite having the technical capability to introduce E20 gasoline, Indonesia currently has only one operational bioethanol plant, limiting the country’s production capacity.
Prabowo cited India, which has implemented E20 nationwide, and Brazil, where pure ethanol fuel (E100) is widely used, as examples of countries that have successfully expanded bioethanol utilization.
The government expects greater private sector participation, supported by regulatory reforms, to help Indonesia achieve its E20 target within the next few years while strengthening domestic renewable fuel production and energy security.