Moeldoko: The Implementation Of Carbon Trade In Indonesia Must Be Optimal Before The End Of Jokowi's Government Period

Presidential Chief of Staff Moeldoko. (Photo: Doc. Antara)

Presidential Chief of Staff Moeldoko emphasized that the implementation of carbon trading in Indonesia must run optimally before President Joko Widodo's administration ends in October 2024.

This was conveyed by Moeldoko when receiving the Director General of Climate Control and Change (PPI) of the Ministry of Environment and Forestry (KLHK) Laksmi Dlamati, at the Bina Graha Building, Jakarta, Friday, April 19.

"Carbon Trading is the President's program. For this reason, acceleration is important while still paying attention to the President's direction, namely establishing a carbon economy ecosystem with integrity, inclusive, transparent and just," said Moeldoko, quoted by Antara, Saturday, April 20.

Moeldoko emphasized the importance of accelerating the preparation and harmonization of regulations, especially in sectors within the Nationally Determine Contribution (NDC), including those related to energy, waste, industrial processes, as well as the use of agricultural, forestry products, and other sectors according to the development of science and technology, such as blue carbon.

Moeldoko said that accelerating the preparation and harmonization of regulations related to carbon trading is needed so that Indonesia can capture the huge market economic potential, both through bilateral carbon trading and the carbon exchange mechanism.

He conveyed that the potential for carbon trading in Indonesia is very large because it has natural wealth, especially with the large number of tropical forests, moderately climate grass, and marine and coastal biodiversity (blue carbon) in the form of mangroves, seagrass, and seaweed which can be a source of carbon absorption and is very important in overcoming the climate crisis.

Our source of power is large, the market potential is also large, demand already exists. However, carbon trading and carbon exchanges have not run as expected. The constraints are in the process of drafting and harmonizing regulations, such as related to carbon taxes and setting carbon emission thresholds in several sectors. This must be resolved immediately," he explained.

Meanwhile, the Director General of PPI-KLHK Laksmi Dewanti explained that in making regulations, the Ministry of Environment and Forestry ensures that the size set in carbon trading can contribute to emission reduction according to the NDC target in the Paris Agreement.

Laksmi said there are two forms of carbon trading that can be done in Indonesia. First, emission trading, where what is sold is the emission limit or emission upper limit agreement, and second, the offset emission, namely the carbon trade which refers to the sale and purchase transaction of emission reduction certificates.

"The plan is that in June 2024 the Ministry of Environment and Forestry will issue a Minister of Environment and Forestry Regulation regarding foreign carbon trading as a result of the carbon trading pilot project," he said.

Saat ini yang sudah berjalan dengan baik adalah Result Based Payment (RBP). Jadi Indonesia mendapatkan pembayaran atas kinerja dalam menjaga emisi Carbon, seperti pembayaran dari Green Climate Fund (GCF) dan Norwegia, imbuh Laksmi.

For information, carbon trading in Indonesia is regulated in Presidential Regulation No. 98 of 2021, and Minister of Environment and Forestry Regulation 21/2022. The carbon trade through the stock exchange was inaugurated by President Joko Widodo on the Indonesian Carbon Exchange (BKI) on September 26, 2023.