Jakarta – The Ministry of Environment, Financial Services Authority (OJK) and the Indonesian Stock Exchange officially started international carbon trading on Monday, January 20.
The carbon trading is traded through the Indonesian Carbon Exchange or IDXCarbon, a unit of the Indonesian Stock Exchange. Launching international carbon trading is considered a milestone for Indonesia’s carbon market, allowing international buyers to purchase carbon units sourced from Indonesia.
President Director of IDX Iman Rachman said that carbon trading is supported by a solid and reliable IDXCarbon trading system. He said IDXCarbon integrates the world’s best practices from the emission quota (allowance) market and the carbon credit market in one system.
This allows players to trade technical agreements for upper emission limits – Business players (PTBAE-PU) and SPE-GRK. “Today’s first international trade shows the readiness and completeness of the IDXCarbon system to support domestic and international carbon trading,” Rachman said.
As an effort to build a transparent, integrated, inclusive, and fair carbon ecosystem, the Indonesian government has strengthened important elements in the carbon ecosystem, namely strengthening the National Registry System (SRN); providing Measurement, Reporting and Verification (MRV); creating greenhouse Gas Emission Reduction Certificate; and Authorization and Corresponding Adjustment (CA) in foreign carbon trade.
In the first phase, up to 1,780,000 tons of carbon units (tCO2e) have been authorised for trading. The carbon units originated from the power sector, namely:
- The New Natural Gas Power Plant PLTGU Priok Block 4
- Single Cycle Power Plant to Combined Cycle (Add On) PLTGU Grati Block 2 conversion project
- Gunung Wugul Mini Hydroelectric Power Plant (PLTM)
- The New Natural Gas Power Plant PLTGU PJB Muara Karang Block 3
- Single Cycle Power Plant to Combined Cycle Block 2 PLN NP UP Muara Tawar conversion project.
These projects are owned by the country’s state electricity company PT Perusahaan Listrik Negara (PLN).
Unfortunately, no carbon units come from the forestry sector, which has abundant resources in Indonesia.
Researcher at the Center for International Forestry Research, World Agroforestry (CIFOR_ICRAF), Herry Purnomo, said the absence of carbon units traded on the carbon exchange shows the complexity of calculating the carbon stocks from the sector. The other problems are due to the unclarity of regulations. (Roffie Kurniawan)
