Indonesia’s new forestry rule signals readiness for global carbon market

Indonesia has entered a new phase in forestry carbon trading following the issuance of Minister of Forestry Regulation No. 6 of 2026 (Permenhut 6/2026 ), which sets out procedures for carbon trading through greenhouse gas emission offsets in the forestry sector, Ecobiz.asia reported.

Signed on April 6 and enacted on April 13, 2026, the regulation serves as an implementing rule of Presidential Regulation No. 110 of 2025 on carbon economic value instruments and replaces previous provisions under the Ministry of Environment and Forestry Regulation No. 7 of 2023.

A key implication of the new regulation is that forestry carbon credits can now be traded internationally without having to wait for Indonesia to achieve its Nationally Determined Contribution (NDC) targets.

Forestry Minister Raja Juli Antoni said the regulation is intended to strengthen governance in the forestry carbon market, making it more credible, transparent, and inclusive, while ensuring that carbon economic benefits contribute not only to national climate targets but also to community welfare and forest sustainability.

Expanding participation and inclusivity

One of the regulation’s main breakthroughs lies in expanding the pool of actors eligible to generate carbon credits. Under Articles 5 and 6, mitigation actors now include not only large corporations but also forest concession holders, social forestry groups, indigenous communities, private forest owners, and environmental service permit holders.

For community-based actors such as social forestry groups and indigenous communities, the regulation allows collaborative schemes through registered facilitators as well as project aggregation mechanisms. This signals a policy shift toward positioning communities as active participants rather than passive beneficiaries.

The regulation also broadens the geographical scope of eligible carbon activities. Article 9 allows projects to be developed across production forests, protected forests, conservation areas under utilization zones, customary forests, private forests, and even certain state forest areas outside designated forest zones.

This approach reflects a landscape based strategy, moving beyond limited project zones toward full optimization of Indonesia’s forestry assets.

Dual credit pathways: SPE and non-SPE

The new ministerial regulation establishes two carbon credit pathways under Article 10.

The first is the domestic certification scheme, known as Sertifikat Penurunan Emisi Gas Rumah Kaca (SPE GRK), which is tied to national accounting systems and allows for corresponding adjustments in line with international climate frameworks.

The second is the non-SPE GRK scheme, which relies on international voluntary certification standards and does not involve the transfer of carbon units abroad in terms of national accounting.

The Ministry of Forestry plays distinct roles in each scheme. It issues recommendations for SPE credits, while providing approvals for non-SPE projects.

Under the non-SPE mechanism, developers are required to submit project design documents, obtain ministerial approval for issuance under international standards, and rely on independent validation and verification bodies without undergoing revalidation by the government.

The government’s role is limited to document completeness checks and legal compliance, effectively recognizing both domestic and international independent verifiers.

For cross border transactions requiring recognition under global climate mechanisms, projects must use the SPE scheme, which includes authorization and corresponding adjustment requirements to prevent double counting.

This dual track design reflects a balancing act between accelerating access to global carbon markets through international standards and maintaining national control over NDC accounting.

Safeguards and integrity requirements

To maintain environmental and social integrity, the regulation introduces strict project requirements.

Project documentation must demonstrate additionality, community involvement, benefit sharing mechanisms, biodiversity protection, reversal risk mitigation, and the principle of free, prior, and informed consent.

These provisions are reinforced through mandatory environmental, social, and governance safeguards, indicating a clear attempt to balance market expansion with integrity standards.

Jurisdictional approach gains ground

Beyond project based schemes, the regulation also introduces jurisdictional carbon mechanisms under Articles 30 to 32.

Both central and regional governments are allowed to develop large scale carbon programs, designate implementing entities, and apply nesting principles to avoid double counting across projects and jurisdictions.

This opens the door for jurisdictional REDD+ type models, which have been widely adopted in international carbon frameworks.

Transition clarity and project pipeline

The regulation provides transitional certainty for ongoing projects. Projects that are already in validation, verification, or issuance stages are allowed to continue, provided they comply with reporting requirements within six months.

This provision is critical in maintaining investor confidence and avoiding disruption in the carbon project pipeline.

According to data obtained by Ecobiz.asia, at least 16 forestry carbon projects are currently in the pipeline and are expected to begin issuing carbon credits as early as May 2026, many of which are registered under international certification body Verra.

As of 2025, based on data from the Indonesia Carbon Project Map 2025 published by Petromindo, forestry and other land use (FOLU) projects registered under Verra are already spread across key regions in Indonesia, including Aceh, Riau, South Sumatra, West Kalimantan, Central Kalimantan, South Sulawesi, Gorontalo, and Maluku.

These projects range from peatland restoration and REDD+ initiatives to mangrove rehabilitation and agroforestry-based carbon programs, involving both private developers and multi-stakeholder partnerships.

No.	Name of Project	Location	Proponent
1.	Kopi lestari agroforestry and land rehabilitation with smallholder farmers in indonesia	Aceh	The Pure Project Sas
2.	Mangrove Restoration and Coastal Greenbelt Protection in The East Coast of Aceh and North Sumatra Province	Aceh-North Sumatra	UNIQUE forestry and land use GmbH
3.	Preserving Peat Swamp Forest Ecosystem Through Redd+ Activity In Kampar Peninsula Riau-Indonesia	Riau	KPHP Tasik Besar Serkap
4.	Riau Ecosystem Restoration Carbon Project	Riau	Multiple Proponents
5.	Sumatra Merang Peatland Project (SMPP)	South Sumatra	Multiple Proponents
6.	OKI REDD+ Project	South Sumatra	Multiple Proponents
7.	Padang Tikar Landscape	West Kalimantan	Multiple Proponents
8.	Kubu Peatland Project	West Kalimantan	Menggala Rambu Utama
9.	The Mayas Project	West Kalimantan	PT Mohairson Pawan Khatulistiwa
10.	Sanggala Corridor Project	West Kalimantan	Multiple Proponents
11.	Rimba Raya Biodiversity Reserve Project	West Kalimantan	Rimba Raya Conservation
12.	PLUM Peat and Mangrove Conservation and Restoration Project (PLUM Project)	Central Kalimantan	PT. Pagatan Usaha Makmur
13.	Katingan Peatland Restoration and Conservation Project	Central Kalimantan	PT. Rimba Makmur Utama (PT. RMU)
14.	South Barito Kapuas Project	Central Kalimantan	PT Nusantara Raya Solusi
15.	Muara Teweh Conservation Project	Central Kalimantan	Fairatmos International Pte. Ltd.
16.	Kupu-Kupu Project - Enhancing Livelihoods through Mangrove Restoration and Silvofishery in South Sulawesi	South Sulawesi	Vlinder Austria GmbH
17.	Reducing emissions from deforestation due to slash-and burn corn by introducing cacao farming in Gorontalo province	Gorontalo	Multiple Proponents
18.	West Seram REDD+ and Agarwood ForestWise Project	Maluku	Multiple Proponents
19.	Seram Climate and Conservation (SERCOVA	Maluku	PT Strata Pasific

State revenue remains in place

From a fiscal perspective, the regulation confirms that carbon trading activities are subject to non-tax state revenue (PNBP).

Under Government Regulation No. 36 of 2024, carbon transactions in forest concession areas are subject to a levy of 10 percent of transaction value, ensuring that the state retains a share of carbon economic gains.

Policy direction and implementation risks

Permenhut 6/2026 reflects two parallel policy directions.

On one hand, it introduces deregulation by recognizing international standards and removing duplicate verification processes. On the other, it reinforces state control through approval mechanisms, NDC accounting requirements, and fiscal instruments.

While this framework accelerates Indonesia’s integration into the global carbon market, its effectiveness will depend heavily on implementation, particularly in the transparency of the national registry system, the capacity of verification bodies, and the enforcement of benefit sharing at the project level.

The regulation marks a new phase for Indonesia’s forestry carbon market, one that is more open and inclusive, yet increasingly complex in governance.

Going forward, the key challenge will lie not in regulatory design, but in execution, ensuring that carbon becomes both an effective climate instrument and a fair economic mechanism for communities.

Editing by Reiner Simanjuntak