Indonesia turns to the mining, rail, and power sector to promote domestic biodiesel consumption

October 28, 2019 | Case Study

Since the June 2018 revision of the Renewable Energy Directive (RED II) that began the phase-out of the use of palm oil for biofuels by 2030, Indonesia has been scrambling for a solution for one its major exports. Despite efforts to negotiate with the EU Commission over the past year, discussions have likely hit an impasse, and the Indonesian government is looking domestically for its new market. Over the past several years, Indonesia has wavered in its biodiesel mandates and struggled to meet volume obligations due to poor palm harvests or unfavorable crude oil and palm oil price splits. However, directly following the announcement of the EU's phase-out of palm oil, the country quickly upped its biodiesel mandate from B20 to B25 in May 2018 and then B30 in July 2018 for 2019.