Govt Urged to Push for More Use of Biofuel

Aug 11, 2014

The Jakarta Globe. Jakarta. Experts slammed the government for not being serious in pushing the use of biofuel as an alternative source of energy, with data from the government showing that consumption remained low.

President Susilo Bambang Yudhoyono’s administration set a quota to blend as much as 4.6 million kiloliters of biofuel with diesel this year. Data from the government, though, showed that nationwide use has yet to meet the targeted quota.

“This has sparked concerns on how serious the government is in implementing the use of biodiesel,” said Iwa Garniwa, the director of energy studies at the University of Indonesia, on Monday. Iwa said that the government could have saved about $3 billion per year had it been serious in promoting the use of biofuel.

Pushing biodiesel is seen as important for the country in helping to reduce the amount the government has to spend for fuel subsidies. The revised state budget showed that the fuel subsidy bill is expected to hit Rp 246 trillion ($21 billion), an increase of 17 percent from the initial projection of Rp 210 trillion. Southeast Asia’s largest economy has also been importing an average 500,000 barrels of oil fuel per day to cover the country’s daily fuel consumption, which reaches the equivalent of 1.5 million barrels per day. The government has set a regulation that requires a blend of at least 10 percent of biofuel in diesel used by commercial businesses, as well as the mining and mining services sector. The regulation is known as the B10 policy.

Gas stations that sell diesel to retail consumers have been applying the B10 policy.

Still, lack of supervision and incentives from the government mean that many companies continue to use unmixed diesel, as some still run their factories or power plants using high-speed diesel, or industrial diesel.

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