Low Carbon Exchange Transactions, OJK Asks All SROs to Evaluate

LABUAN BAJO - The Financial Services Authority (OJK) hopes that all related parties such as Self Regulatory Organizations (SROs) in the implementation of carbon exchange transactions can conduct evaluations, because carbon exchange transactions are still minimal.

Chief Executive of the Capital Market Supervisory, Derivatives Finance, and Carbon Exchange of OJK Inarano Djajadi hopes that there will be a carbon exchange evaluation step in line with the manifestation of Indonesia's commitment to zero emissions or Net Zero Emission (NZE) by 2060 or sooner.

"We welcome it if there is an evaluation like that. Of course, the evaluation, as far as I understand it, is not only for the carbon exchange, but the entire ecosystem that surrounds the carbon exchange," said Inarno on the sidelines of the Capital Market Journalist Workshop, Thursday, October 31.

Inarno explained that the evaluation consists of several ecosystems related to the smooth running of carbon exchange transactions, namely the implementation of carbon taxes, to carbon trading permits.

"What we need to know is that the carbon exchange is part of the whole. It is part of the secondary. Well, the primary must also be encouraged, right? Something like that. The primary is of course in the Ministry of Environment and Forestry and related institutions," he said.

Previously, the Indonesia Stock Exchange (IDX) recorded carbon exchange trading transactions of only IDR 37 billion, after a year of official operations or since September 2023.

However, this value is still very small or less than 1 percent when compared to the potential target value of carbon credits in Indonesia which could reach IDR 3,000 trillion.

"Currently, the Indonesian Carbon Exchange transactions have been traded with a value of more than IDR 37 billion," said IDX President Director Iman Rachman on the sidelines of the Carbon Exchange One Year Commemoration event, Thursday, October 3.

The total transaction was recorded after the number of Greenhouse Gas Emission Reduction Certificates (SPE-GRK) or carbon credits traded amounted to 613,894 tons of CO2 equivalent, with 81 service users.

From the 613,894 tons traded, there were more than 420,150 tons of carbon units that had been used as offsets through the retirement process, which came from 3 SPE-GRK projects, namely Lahendong Unit 5 & 6 PT Pertamina Geothermal Energy Tbk, New Natural Gas Power Plant PLTGU Block 3 PJB Muara Karang owned by PLN, and Gunung Wugul Minihydro Power Plant (PLTM).

"Even if it is still shallow now, of course we must realize that it is only one year, right? But other things that we need to fix, we must fix," he explained.