Voluntary Carbon Market Project Pilot

Voluntary Carbon Market Project Pilot Elucidation

The Ministry of State-Owned Enterprises (KBUMN) announced the Indonesian voluntary carbon market between BUMNs, which will be active in 2023. This was marked by signing an intent letter between BUMNs (Pertamina, Perhutani, PLN, MindID, SIG, Pupuk Indonesia, PTPN 3 as Project Pilot, and ID Survey – BKI as facilitator) in October 2022 at the G20 Bali event. This initiative is expected to support the reduction of the NDC emission target by 2030 by financing the availability of projects that contribute to reducing and/or eliminating emissions, both nature-based and technology-based. Then, eventually achieving net zero emissions by 2060 or sooner.

State-Owned Enterprises (BUMN) facilitate the development of the Indonesian voluntary carbon market, enabling them to act as:

  • Seller, for SOEs that have a target amount of carbon surplus (net allowance) and/or carbon credits that have been validated and intend to sell
  • Buyers for SOEs with a negative carbon target number (net allowance) that has been validated must balance the carbon target by offsetting other SOE surplus allowances and/or purchase carbon credits.

Voluntary Carbon Market Project Pilot Service Scope

The carbon market pilot project has objectives that include:

  • Achieve synergies between SOEs in pushing for the decarbonization agenda
  • A potential cost-effective solution to address internal cost reduction
  • Carbon revenue to incentivize project development belongs to SOE (i.e., additional finance)

Additional Information

Voluntary Carbon Market Project Pilot