March 11, 2026 | 07:08 am
TEMPO.CO, Jakarta - An agreement to import bioethanol from the United States (US) appears in the Agreement on Reciprocal Trade (ART) between Indonesia and the US. Trend Asia believes this obligation risks creating a double burden of subsidies before it is converted into biofuel or other products.
Trend Asia's Research and Investigation Manager, Zakki Amali, stated that ethanol imported from the US is usually made from corn or starch. "When imported, it requires a subsidy, a subsidy for how this biofuel is blended," he said in a hybrid media briefing on Tuesday, March 10, 2026.
According to Zakki, blending is costly, so subsidies are needed. The costs are not only incurred during the blending process, but also when the product is distributed on the market. "This also includes retail sales through gas stations; this also requires subsidies," he said.
Trend Asia believes that agreements to purchase energy commodities from the US should not only consider domestic import needs but also assess the resulting emissions and the additional subsidy costs.
The bioethanol import agreement is stipulated in Article 2.23 of the ART document. This clause prohibits Indonesia from adopting or maintaining any policy that hinders the import of bioethanol from the United States.
This article also mandates a phased ethanol use. "Indonesia will implement its policy to provide transportation fuel blended with up to five percent bioethanol (E5) by 2028 and up to 10 percent bioethanol (E10) by 2030," reads the second point of Article 2.23.
Furthermore, Indonesia will strive to implement its policy regarding the use of bioethanol blends in transportation fuels of up to 20 percent bioethanol (E20), depending on supply availability and the readiness of supporting infrastructure.
Previously, Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia, stated that the plan to import US bioethanol aims to fill the gap between demand and domestic production.
"Regarding ethanol imports, if there's a gap between our needs and our production. For example, if our production is 10% and our demand is 20%, we can import 10%, including from America," Bahlil said after a press conference on the latest developments in the Middle East and their implications for the Energy and Mineral Resources sector, held at the Ministry of Energy and Mineral Resources office in Jakarta on Tuesday, March 3, 2026, as quoted by Antara.
Read: Pertamina NRE Unveils Palm Sugar-Based Bioethanol Innovation
Click here to get the latest news updates from Tempo on Google News
Pertamina NRE Unveils Palm Sugar-Based Bioethanol Innovation
22 November 2025
Pertamina describes this project as a form of company innovation in the research and development of multifeedstock bioethanol.
Indonesia Plans to Mandate Ethanol Fuel Blend Starting in 2028
12 November 2025
The mandatory regulation of bioethanol has existed since 2008 through the Minister of Energy and Mineral Resources Regulation Number 32/2008.
Indonesia Promises Incentives for Companies Investing in Ethanol Plants
24 Oktober 2025
Minister Bahlil said the government will offer incentives for ethanol plant investors to support the 2027 rollout of mandatory 10% bioethanol fuel.
Indonesia to Run B40 Biodiesel in 2025, Energy Minister Says
5 Agustus 2024
Arifin Tasrif said Indonesia's government will accelerate the implementation of B40 biodiesel.
Minister Airlangga Says No Restrictions on Subsidized Fuel in Place
17 Juli 2024
Coordinating Minister Airlangga Hartarto stated that there are currently no restrictions on purchasing subsidized fuel.
Investment Minister Vows to Accelerate Indonesia's Sugar, Bioethanol Self-Sufficiency
3 Mei 2024
Bahlil will accelerate the facilitation of investment to achieve sugar and bioethanol self-sufficiency
Energy Ministry to Implement Bioethanol E5 Gasoline in Surabaya and Jakarta
3 Agustus 2023
The Energy and Mineral Resources Ministry will implement the mixture of 5% bioethanol in gasoline, also known as E5 in Jakarta and Surabaya this year.
Pertamina: Pertamax Green 95 Suitable for All Gasoline Vehicles
25 Juli 2023
State-owned oil and gas firm PT Pertamina has officially sold its newest fuel product Pertamax Green 95 at a price of Rp13,500 per liter.
Pertamax Green 95 Officially Available at Rp13.500 per Liter
25 Juli 2023
Pertamina officially sells bioethanol fuel Pertamax Green 95 today, July 24, 2023.
Pertamina Introduces Biofuel Pertamax Green 95
4 Juli 2023
Pertamina plans to launch its maiden bioethanol product with the research octane number (RON) 95 dubbed Pertamax Green 95.
:strip_icc():format(jpeg)/kly-media-production/medias/5486410/original/015853500_1769586166-Pesib_Kurzawa.jpg)
