Biodiesel Purchase Schemes to be Changed
Indonesian government is reviewing a change to biodiesel purchase mechanism as well as incentives payout mechanism to lower global pressure on alleged subsidies to biodiesel.
JAKARTA--Indonesian government is reviewing a change to biodiesel purchase mechanism as well as incentives payout mechanism to lower global pressure on alleged subsidies to biodiesel.
According to the Director General of the foreign trade Ministry of Commerce Oke Nurwan, the mechanism to be changed in order to avoid the accusations from the United States that Indonesia provides subsidies to biodiesel producers.
US issued an affirmative final antidumping duty on biodiesel shipments that originate from Indonesia. Since 2016, the Indonesian Oil Palm Estate Fund (BPDPKS) has been managing government incentives to support the implementation of the 15-percent biodiesel blending (B15) policy in 2015 and 20-percent blending (B20).
BPDPKS provides insentives to cover price difference between MOPS and biodiesel price. Based on current mechanism, producers accept incentives for every biodiesel they produce, then they sell their biodiesel to Pertamina.
On new mechanism, the incentives will be paid directly to Pertamina, not to producers. This means, Pertamina will buy biodiesel based on market price from producers, then BPDPKS will pay the price difference to Pertamina. ***
