Environment Ministry Admits Carbon Trading Implementation Not Optimal, Here Are the Reasons
JAKARTA – The Ministry of Environment and Forestry (KLH) has admitted that the transition process towards a more open national carbon trading system still faces various obstacles, ranging from infrastructure readiness to disparities in capacity across sectors.
Director of Governance for the Implementation of Carbon Economic Value at KLH, Wahyu Marjaka, stated that the policy update through Presidential Regulation (Perpres) No. 110 of 2025 is a crucial point, but its implementation has not run entirely smoothly.
“Perpres 110 officially opens the voluntary system. This is a major change compared to the previous Perpres 98, which did not regulate it clearly,” said Wahyu during a discussion held by Forest Watch Indonesia on Tuesday (31/3/2026).
He explained that the new policy replaces Perpres No. 98 of 2021 while strengthening the mandate for cross-sector carbon trading. However, the opening of the voluntary carbon market is not done directly in full, but through carefully designed transition stages.
According to Wahyu, the government requires about seven months for the transition period, consisting of four months before the cabinet changeover and three months after Perpres 110 was issued. During that period, the government worked extra to ensure the new system could operate.
“We did not suddenly jump straight into a full voluntary system. There are priorities and stages for the transition from compliance to a more open system,” he said.
Nevertheless, he acknowledged that the speed of implementation in the field is not uniform. Each sector has different levels of readiness, both in terms of regulation, infrastructure, and technical capacity.
The forestry sector, which was initially expected to be the main driver of the national carbon trade, has instead shown slower progress compared to other sectors such as energy. Wahyu mentioned that the complexity of preparing the legal framework and operational aspects is one of the main causes.
“Factually, the forestry sector, which was projected as the prime mover, is moving more slowly. This is because the needs for detail in preparing the legal framework and operationalisation are much higher,” he said.
In addition to forestry and energy, the government is also preparing the development of carbon trading in the agriculture, industrial processes and product use (IPPU), and waste sectors. New initiatives such as blue carbon are also starting to be considered, although not yet fully ready in terms of documentation.
To support the system, KLH has prepared the main infrastructure in the form of the national carbon registry system called the System Registry Unit Karbon (SRUC). This system functions to record all cross-sector carbon trading activities, from data input to transactions.
“SRUC is ready to be operationalised and tested at the end of March,” said Wahyu.