Indonesia to launch carbon exchange in September

Indonesia plans to launch its carbon exchange in September, and power generation companies will be the first to operate on it.

The exchange will be managed by the Stock Exchange of Indonesia (BEI), under the supervision of the Financial Services Authority, and the Ministry of Environment and Forestry.

According to Dr. Ignatius Wahyu Marjaka, Director of the Ministry’s Sectoral and Regional Resource Mobilization Department, power producers that operate coal-fired power plants and have an emission level below that set by the government can sell emission allowances to their counterparts. less efficient.

In February, Indonesia – the largest economy in Southeast Asia and the world’s eighth largest emitter of greenhouse gases – launched the first phase of mandatory carbon trading for 99 coal-fired power plants owned by 42 companies and supplying electricity to the state company PLN.

More than half of the electricity generated in the country comes from coal.

Wahyu said that Indonesia is also studying companies in the forestry sector that are highly capable and can qualify to participate in the exchange in September.

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Forestry and other similar sectors related to land use, along with energy and transport, make up 97% of Indonesia’s commitment to reduce emissions and adapt to climate change.

The exchange will be managed by the Stock Exchange of Indonesia (BEI), under the supervision of the Financial Services Authority, and the Ministry of Environment and Forestry.

Late last year, the government improved its goal of reducing emissions by 2030 by 31.89%, or 43.2% with international financial help.

Wahyu said the Indonesian government is also identifying the entities that contributed to removing 577 million tons of carbon dioxide equivalent (CO2e) verified under the United Nations Framework Convention on Climate Change between 2018 and 2020. The current identification is targeting those representing 100 million tons of CO2e of the global figure, he said.

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