JAKARTA (Reuters) - Indonesian president Joko Widodo wants biodiesel with a 30% bio-content, known as B30, to be in use by January 2020 to increase palm oil consumption and reduce energy imports, the Cabinet Secretary office said in a statement on Twitter.
Indonesia currently has a mandatory B20 program that Widodo told a cabinet meeting could save the country around $5.5 billion dollars per year in fuel imports, if it was implemented consistently, according to the Cabinet Secretary.
The Indonesian government has been ramping up efforts to boost domestic use of palm oil, the feedstock for its biodiesel, as the vegetable oil has seen sluggish demand due to import duties imposed by top buyer India and restrictions in European Union markets because of environmental concerns.
The Cabinet Secretary’s statement said Widodo will personally check the implementation of the mandatory B20 program, which was expanded in September last year, as well as the plan to switch to B30.
“All parties must be aware that Indonesian crude palm oil is in a depressed position due to global demand, so everyone must have the same commitment, same desire, that the domestic market can solve this problem,” it said.
The president also said he wanted to possibly increase palm content in the biodiesel program further by the end of 2020, according to a statement from the palace.
FX Sutijastoto, director general of renewable energy at the energy ministry, said separately that the government is looking into creating a fuel made from a mix of palm fatty acid methyl ester (FAME), fossil fuel and another diesel fuel made entirely from palm oil.
State energy-company PT Pertamina [PERTM.UL] is currently conducting studies to process palm oil into fuels.
The president also has asked ministers to study further the possibility of mixing palm oil-based fuel with jet fuel, the statement said.
The government is currently conducting road tests for diesel vehicles running on B30 fuel.
The country could consume up to 9.6 million kilolitres (kl) of fatty acid methyl ester, the palm content in the biodiesel, in 2020 with the B30 program, deputy energy minister Arcandra Tahar said last month. That’s more than a 50% increase from an estimated consumption of 6.2 million kl this year.
Sutijastoto said the government is currently drafting detailed plans on developing its palm energy sector.
Reporting by Fransiska Nangoy and Bernadette Christina Munthe; Editing by Christian Schmollinger, Tom Hogue, Kirsten Donovan