Designing Institutions Amid the Carbon Market Euphoria

On 9 July 2026, the government officially launched the Carbon Unit Registry System (SRUK), which becomes the new foundation for the national carbon trading ecosystem, replacing the National Registry System for Climate Change Control. Based on blockchain technology and directly connected to the Indonesia Carbon Exchange, SRUK is designed to ensure that every carbon unit traded passes strict verification and is protected from the risk of double counting. The government is targeting Indonesia to become a major player in the world carbon market, with a projected value said to reach thousands of trillions of rupiah in the coming years. As of mid-year, trading volume on the Indonesia Carbon Exchange had only reached approximately 1.98 million tonnes of CO2 equivalent, valued at Rp93.81 billion, a figure relatively small compared to the touted potential of thousands of trillions. The number of exchange service users has also only reached 155, with the government targeting the addition of only about 45 new users by the end of the year. This gap between potential on paper and realisation on the ground indicates one thing: the regulatory infrastructure and system are relatively mature, but the supply of genuinely trade-ready carbon projects remains a weak point. Interestingly, upon closer examination, the initial supply of carbon units on the exchange is still dominated by projects from the renewable energy and forestry sectors. The marine and fisheries sector, which holds one of the world’s largest blue carbon reserves through mangrove ecosystems, seagrass beds, and coastal peat swamps, has yet to contribute significantly to this supply. In terms of potential, this sector has substantial capital. As an illustration, a mapping study of blue carbon potential in mangroves along the North Coast of Java identified eight zones with a total potential area of 106,324 hectares, stretching from Serang to Madura. From this area, the projected carbon sequestration over fifty years is estimated to reach 43.45 million tonnes of CO2 equivalent, with convincing financial feasibility; even under the most conservative carbon price scenario, the rate of return on investment remains in the double digits, with a payback period of less than eight years. These figures confirm that the Pantura region has sufficient resources to become one of the main national suppliers of blue carbon units in the future. The same study shows that nearly half of the land in one priority block still has ‘under identification’ status, making it unclear whether it is classified as state land, community land, or an area requiring further legal settlement. Furthermore, a benefit-sharing scheme involving developers, communities, and the government ultimately demands something far more complex than mere investment calculations: how to design a multi-stakeholder institution that operates effectively and equitably. At this point, lessons from outside the marine and fisheries sector may be relevant. A dissertation titled ‘Institutional Model for Marine Economic Development in Labuan Bajo, Indonesia’, defended at the Doctoral Programme in Tropical Marine Economics, Bogor Agricultural University, late last year, offers an interesting analytical framework for scrutiny. Combining the Institutional Analysis and Development approach with multi-actor prospective analysis, the study maps how various stakeholders—including central government, local government, business actors, local communities, academics, and the media—interrelate in managing a complex marine economic zone. The main findings are quite illuminating: no single actor dominates the governance of the marine economy in Labuan Bajo. Most stakeholders, including the government and business actors, are in a position of high mutual dependence. The most decisive factors for successful development are not capital or technology alone, but rather community participation, regulatory clarity, infrastructure availability, and human resource quality. From a series of institutional scenarios tested, a collaborative strategy based on the pentahelix model—which places government, business, academia, community, and media on an equal footing within a governance framework—proved to be the most robust and consistently superior option compared to schemes that centralise authority in one party. According to the study, such a collaborative approach also demonstrably reduces institutional transaction costs, which have often been a hidden barrier slowing the realisation of marine economic projects. This logic is worth considering for application in blue carbon project development, including along the Pantura. Rather than viewing profit-sharing schemes solely as financial transactions between developers, communities, and the government, it would be more appropriate to frame the distribution of benefits as part of a broader collaborative institutional design. This design should explicitly accommodate the role of academia in providing databases and scientific verification, the role of the media in ensuring public information transparency, and the role of coastal communities not merely as beneficiaries, but as active partners in area management. The current momentum is arguably ideal for beginning to design such an approach. The spirit of SRUK, which emphasises integrity, transparency, and equitable distribution of benefits down to the site level, aligns with the collaborative principles proven effective in the study of marine economic institutions. If the readiness of the national carbon market system and regulations can be combined with a field-tested, academically sound institutional design, the marine sector could become a key pillar in Indonesia’s carbon market leadership.