Indonesia is among the countries with the most serious efforts to develop their biofuel (Vegetable Fuel or BBN) policy and standing at the forefront of global biofuel mixture levels, especially palm oil-based. However, before attaining this position, the Indonesian biofuel industry went through quite a long history. The development of biofuels in Indonesia can be traced back to the 1990s, where several institutions conducted research on the potential of biofuels from various raw materials such as palm oil, jatropha, used cooking oil and so on. In 2006, when President Susilo Bambang Yudhoyono issued several regulations regarding the National Energy Policy and the use of biofuels, this became a milestone in the development of biofuels in Indonesia.
Since then, the landscape of national biofuel development has seen significant evolution, encompassing improvements in quality, production volume, biofuel varieties, and a notable increase in the participation of companies. This transformation initially aimed to advance poverty reduction and bolster the nation’s energy self-sufficiency.
Throughout its development, Biofuels (BBN) have grown to be intricately tied to the energy transition and the imperative of reducing carbon emissions. Globally, the continued use of fossil fuels to meet future energy requirements is acknowledged as unsustainable, primarily due to the depletion of finite resources and the environmental harm it inflicts. Ideally, there should be efforts to curtail energy consumption. However, it’s crucial to recognize that worldwide energy demand is projected to surge by an estimated 47% by 2050. Consequently, biofuels have emerged as a prominent component of the energy transition strategies being explored, not least in Indonesia.
Indonesia’s interest in diminishing its reliance on petroleum and mitigating emissions within the transportation sector has spurred the swift growth of the biofuel industry. Nevertheless, the advancement of biofuels is not devoid of its dilemmas. A growing unease revolves around the use of vegetable oils, which also serve as essential food resources, in biofuel production and its potential implications on food security and the environment.
This concern is well-founded, as the ever-increasing demand for vegetable oils, coupled with the tendency of productivity to plateau, inevitably forces the government into a challenging conundrum. It must decide between enhancing productivity, potentially impacting another sector, or allocating additional land to meet these escalating demands. Despite the various potential challenges that may arise from the development of biofuels, these challenges do not justify reverting to fossil fuels and abandoning the pursuit of biofuels.
The solution to the challenges posed by the energy transition may still find answers, at least in part, through biofuels. The critical focus lies in determining how the governance of BBN in Indonesia can effectively strike a balance between the interest of energy security and environmental sustainability. Therefore, Madani Berkelanjutan has meticulously curated a comprehensive synthesis of diverse dialogues and scholarly analyses concerning the dynamics of biofuel development in Indonesia, drawn from a multitude of published sources and research studies.