Biodiesel mix policy faces challenges

The government?s mandatory biodiesel mix policy is difficult to be realized particularly in the heavy equipment sector, according to the National Energy Council (DEN).

DEN member Syamsir Abduh said on Thursday that while the 20 percent biodiesel policy has been generally implemented in the automotive sector, the heavy equipment sector including heavy equipment used in the mining sector, locomotive, and military/defense sector have been reluctant to follow existing regulations requiring 20 percent bio content in automotive diesel fuel. The 20 percent biodiesel mix must be achieved in 2020, and 30 percent in 2030.

The heavy equipment operators have complained that mixing biofuel with biodiesel will cause higher maintenance cost and will require them to change engine components more often. He said that the locomotive and defense sectors have openly opposed the biodiesel mix policy.

As such, DEN suggested the government to reschedule the 30 percent biodiesel mix target beyond the initial deadline of 2030 until heavy equipment engine are ready to adjust to the policy. Syamsir also advised the government to introduce new regulation including fiscal incentives to push for speedy implementation of the biodiesel mix policy.

Indonesia produced 630,000 kilo liters (kl) of palm oil-based biofuel in 2008 with consumption of 23,000 kl. Last year, production volume jumped to 2.5 million kl.

Editing by Reiner Simanjuntak