E20 Implementation Pending Feedstock Availability
The Ministry of Energy and Mineral Resources (ESDM) has stated that the implementation of a 20% bioethanol blend mandate, known as E20, remains dependent on feedstock readiness and technical preparations being undertaken by the government alongside relevant stakeholders.
The Director General of New, Renewable Energy, and Energy Conservation (EBTKE), Eniya Listiani Dewi, noted that the government must ensure the availability of raw materials before establishing a mandatory ethanol blending level. “If we set a specific level but it is not achieved, it will be futile. Therefore, our mandate will truly depend on the feedstock,” Eniya said in Jakarta on Wednesday.
According to her, the government is currently preparing upstream readiness to support bioethanol implementation, including encouraging investment in factory construction. In a scenario where E20 is used for the non-PSO (Public Service Obligation) sector, the bioethanol supply requirement is estimated to need approximately 20 factories, each with a minimum capacity of 40,000 kilolitres per year.
“The revision of Presidential Regulation 40 regarding sugar and bioethanol is currently being discussed. In it, we will include the calculated demand for the non-PSO sector; if we implement 20%, we will need around 20 factories with a minimum scale of 40,000 kilolitres per year—the larger, the better. From this, we hope all investments will move towards the upstream sector,” Eniya added.
Eniya emphasised that the mandatory blending level will consider the capacity of local raw material provision so that the established policy can be supported by supply availability. Furthermore, she stated that the government is preparing three Market Index Prices (HIP) for bioethanol based on raw materials: molasses, cassava, and maize. These three HIPs are being discussed with associations and stakeholders to determine prices appropriate for each feedstock.
Eniya explained that this mechanism is necessary because bioethanol prices will depend on the type of raw material used. On the technical side, the government is also collaborating with the automotive sector, as end-users, to prepare for E20 implementation. She noted that her department is preparing technical specifications up to E100, which can be adjusted according to the bioethanol blending level. This preparation is essential so that once the government establishes a mandatory policy, implementation can proceed immediately.
The government plans to implement the 20 per cent ethanol blend (E20) in fuel by 2029 as part of efforts to strengthen national energy security.