Government to strengthen biodiesel mandatory program
Wednesday, September 21 2016 - 09:28 AM WIB
The Ministry of Energy and Mineral Resources is finalizing a revision of Ministerial Regulation No 32/2008 on biodiesel mandatory program in a bid to strengthen the program amid low biodiesel absorption.
Head of Bio-energy at the ministry?s Directorate General of New and Renewable Energy, Edi Wibowo said on Tuesday that under the revised regulation, there will be sanction for fuel retailers and entities failing to implement the 20 percent biodiesel mandatory program.
He said that in the first eight months of this year, biodiesel absorption only reached 1.95 million kilo liters, or 52.7 percent of the full-year target of 3.6 million KL.
He said that low absorption of biodiesel was noticeable in non-subsidized diesel fuel. He pointed out that in the January-August period, biodiesel absorption in subsidized diesel fuel reached 1.74 million KL, while in non-subsidized diesel reached only 205,302 KL.
Edi said that the low absorption in non-subsidized diesel was because of the absence of sanction, while the government has applied a sanction of Rp 6000 per liter to retailers failing to implement the mandatory program for the subsidized fuel.
The government increased the biodiesel mandatory program for the transportation and industry sectors to 20 percent this year from 15 percent last year.
Meanwhile, Director General of New and Renewable Energy Rida Mulyana said that the low absorption was also related to wide discrepancy between biodiesel price and non-subsidized diesel fuel in May-June period. He said that biodiesel price stood at Rp 8,737 per liter in June, while diesel price was only Rp 3,362.23 per liter, creating a difference of Rp 5,374.77 per liter. But the difference narrowed to Rp 3,000-Rp 4,000 per liter in August.
Editing by Reiner Simanjuntak