Indonesia Could Become A World Carbon Hub To Beat Japan

Green energy (Photo: dock. Antara)

JAKARTA - Indonesia can become a world carbon hub. This achievement can beat Japan, which has already implemented Carbon Capture and Storage (CCS) and Carbon Capture, Utilization, and Storage (CCUS) technology.

Indonesia's great potential as a world carbon trade center can be seen with the existence of several CCS hub projects currently being developed in Sumatra, northern and western Java, Papua, and Masela. This location is a potential that might be developed as a CCS hub," said Chairman of the Indonesia Carbon Trade Association (IDCTA) Riza Suarga quoting Antara.

This was conveyed in relation to the plan of the Carbon Digital Conference Forum (CDC) on November 8-10, 2023 in Bali, which is one of the efforts to make Indonesia the world's carbon hub. There will be 350 participants present at the forum discussing the carbon market.

IDCTA hopes that carbon purchase transactions will occur at the forum and hopes that President Joko Widodo's ideals, which want to make Indonesia a world carbon hub/poros, can be achieved in the near future.

According to Riza, CCS will be a new way in developing low-carbon businesses in the future, including hydrogen development and green and blue ammonia.

The CDC 2023 Forum is also a place to meet potential carbon buyers. Riza gave an example, there are around 15 thousand Japanese companies in Indonesia that are potential carbon buyers.

Indonesia has tremendous natural resource potential and this potential can be optimized to reduce carbon emissions, including utilizing it through carbon exchanges.

President Joko Widodo said the potential for the Indonesian carbon market reached more than IDR 3,000 trillion. This potential will be a new sustainable and environmentally friendly economic opportunity.

This is in line with the direction of the world that is heading towards a green economy. Domestic carbon trading activity, through primary trade between business and secondary entities through the Financial Services Authority (OJK) exchange, can reach US$1 billion to US$15 billion or equivalent to Rp225.21 trillion every year.

CDC 2023 is organized by IDCTA in collaboration with the International Emission Trading Association (IETA), PwC Indonesia and the Ministry of Tourism and Creative Economy (Kemenparekraf).

Yuliana Sudjonno as PwC Indonesia Sustainability Leader and Knowledge Partner for CDC 2023, added that Indonesia has an abundant supply of carbon credit, but without a strong demand side in the carbon market, the supply market will mean nothing.

In addition, an ecosystem is also needed that supports the credit quality monitoring mechanism so that it can create public trust in the reliability and credibility of credit traded on the Carbon IDX.