Enviro News Asia, Jakarta – The Ministry of Environment (KLH) is ready to initiate international carbon trading as part of its efforts to address climate change while opening up new economic opportunities for businesses and society.
“Through carbon trading, we invite businesses and the public to participate in emission reduction efforts while leveraging the economic potential of carbon,” said Minister of Environment and Head of the Environmental Control Agency (BPLH) Hanif Faisol Nurofiq in a statement in Jakarta on Tuesday (January 14).
He explained that the launch of the carbon trading system demonstrates Indonesia’s growing commitment to tackling climate change. Under Presidential Regulation No. 98/2021, the government has established a carbon trading mechanism as part of the carbon economic value framework (NEK).
The mechanism will be managed by the National Climate Change Control Registration System (SRN-PPI). This system aims to ensure that every stage of carbon trading is recorded clearly and transparently.
Emission reduction certificates, known as Greenhouse Gas Emission Reduction Certificates (SPE GRK), will be issued as part of this system. These certificates verify that a project has successfully reduced greenhouse gas emissions through a verified process, including measurement, reporting, and verification (MRV).
Each certificate will be recorded in the SRN-PPI and made publicly accessible, ensuring a transparent carbon market. As part of this initiative, the Carbon Exchange, managed by the Financial Services Authority (OJK), will record carbon transactions in both domestic and international markets.
Every carbon transaction within the carbon market will be monitored and recorded in the SRN-PPI. International carbon trading is scheduled to begin on January 20, 2025, with four major projects already registered, including natural gas and mini-hydro power plant projects owned by PT PLN Indonesia Power and Nusantara Power. These projects are expected to generate emission reductions that can be traded in the international carbon market.
For technical discussions on the carbon exchange, a special meeting was held on Tuesday (January 14, 2025) between the Ministry of Environment/Environmental Control Agency (KLH/BPLH), the Environmental Fund Management Agency (BPDLH), the Indonesia Stock Exchange (IDX), and the Financial Services Authority (OJK).
Ary Sudijanto, Deputy for Climate Change Control and Carbon Economic Value Governance at KLH/BPLH, stated that international carbon trading will soon be launched, as authorization issues were resolved during COP 29 UNFCCC in Baku, Azerbaijan.
Joko Tri Haryanto, President Director of BPDLH, remarked that this is a significant step for Indonesia in strengthening its position in the global carbon market. He emphasized that Indonesia will continue to move forward in achieving its NDC targets and playing a key role in global emission reductions while utilizing the economic potential of carbon.
Ignatius Denny Witjaksono, Head of Business Development Division 2 at IDX, highlighted IDX’s role through its IDXCarbon platform in facilitating carbon trading. IDX aims to simplify carbon trading by providing a regulated carbon exchange rather than direct trading. Registered trading units within the SRN offer price transparency and competitiveness.
Meanwhile, OJK stressed the importance of ensuring that carbon trading through the exchange complies with existing legal frameworks.
