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Indonesia Needs New Biodiesel Plants

21 July 2014 15:06 WIB

Biodiesel Menghemat Subsidi Rp 4,9 Triliun

TEMPO.CO, Jakarta - Togar Sitanggang, secretary general of the Indonesian Biofuel Producers Association (Aprobi), said Indonesia should build new biodiesel plants to anticipate surging demand. Biodiesel demand is expected to increase by 60 percent after the B20 program—where the government would mandate a 20-percent part of biofuel in Solar diesel mixture—takes effect.

Togar estimated that the annual consumption of biodiesel will increase to 8 million kiloliters once the B20 program begins. He is certain that the program will not disrupt the domestic supply of crude palm oil (CPO) due to the abundant resources. With 30 million kiloliters of CPO produced domestically, only five million kiloliters are used for biodiesel, mostly absorbed by the cooking oil and oleochemicals industries.

In addition to domestic demand, Indonesia's biodiesel output will also be absorbed by several countries. Last year, biodiesel exports reached 1.2 million kiloliters, accounting for 83 percent of the national production. Although the current biodiesel export has declined by 25 percent due to sluggish demand from Europe, Togar said he is not worried as there are a number of major automotive manufacturers involved in testing the use of B20.

"This will facilitate the overseas marketing of Indonesian biodiesel," he said.

Iwa Garniwa, director of energy studies at the University of Indonesia, said biodiesel is not only produced from palm oil. He stressed the need for the development of new commodities that are widely available in Indonesia as raw materials for biofuel. If this can be realized, Iwa believes that the fuel subsidy may be reduced by up to Rp98.5 trillion.

"The government needs to take systematic measures to gradually increase the mix ratio of biofuels," he said.

FAIZ NASHRILLAH | AMIR TEJO



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