Minim Carbon Exchange Transactions, OJK Asks All SROs To Evaluate

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

Chief Executive of the Capital Market Supervisory, Derivative Finance, and OJK Carbon Exchange Inarno Djajadi hopes that there will be steps to evaluate the carbon market in line with Indonesia's commitment to zero emissions or Net Zero Emission (NZE) by 2060 or sooner.

"We welcome if there is an evaluation, yes. Of course, the evaluation is in my opinion, not only for carbon exchanges, but the entire ecosystem that covers the carbon market," said Inarno during the Capital Market Journalist Workshop event, Thursday, October 31.

Inarno explained that the evaluation consisted of several ecosystems related to the smooth running of carbon exchange transactions, namely the application of a carbon tax, to carbon trading permits.

"What we need to know is that the carbon exchange is part of the whole thing. It's part of the secondary. So the primary must also be pushed, right. That's roughly the case. The primary is of course in the Ministry of Environment and Forestry and related institutions," he said.

Previously, the Indonesia Stock Exchange (IDX) recorded a carbon exchange trading transaction of only IDR 37 billion, after officially operating for a year or since September 2023.

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

"Currently, Indonesia's Carbon Exchange transactions have been traded with a value of more than Rp37 billion," said IDX President Director Iman Rachman during the One-Year Carbon Exchange Commemoration event, Thursday, October 3.

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

Of the 613,894 tons traded, there are more than 420,150 tons of carbon units that have been used as offsets through the retirement process, which comes from 3 SPE-GHK projects, namely Lahendong Unit 5 & 6 PT Pertamina Geothermal Energy Tbk, PLTGU Natural Gas Fueled Power Plant Block 3 PJB Muara Karang owned by PLN, and Mount Wugul's Minihydro Water Power Plant (PLTM).

"Even if it's still shallow now, of course we have to realize that it's only been a year, right. But we need to fix other things, we have to fix them," he explained.