Indonesia Aims to Implement Sugarcane Bioethanol Mandate, but Major Challenges Remain
The Ministry of Energy and Mineral Resources (ESDM) has identified various challenges in implementing the 10% bioethanol (E10) blending mandate for fuel. Major obstacles include the lack of feedstock supply and the need to develop highly limited domestic production infrastructure.
Eniya Listiani Dewi, Director General of New, Renewable Energy, and Energy Conservation (EBTKE) at the Ministry of ESDM, explained the necessity of accelerating investment to build an independent bioethanol ecosystem. According to her, without a significant increase in production capacity, the E10 mandate target will be difficult to achieve.
“I want to encourage ethanol investment as quickly as possible; our calculation is that by 2027, there must be 20 factories,” she stated during The 12th Indonesia EBTKE ConEx 2026 at Jiexpo on Wednesday.
Her department estimates that the feedstock requirement to support the E10 blending policy next year will reach 1.2 million kilolitres (KL). However, the current capacity of collected feedstock only reaches 70,500 KL per year.
“If the feedstock for E10 alone next year requires approximately 1.2 million KL, currently we are only able to collect 70,500 kilolitres per year,” Eniya explained.
In addition to production capacity issues, the ministry is also reviewing the specifications for blending ethanol into petrol. Determining these specifications is considered vital, as the product quality for E10 and E20 programmes is expected to have different standards to ensure vehicle engine safety.
“For B50, there is water content. For ethanol, we must determine which parameters to use; the specifications for E10 and E20 may not necessarily be the same,” she added.
Through the E5 programme currently implemented by PT Pertamina (Persero), the government is committed to attracting investor interest to build dozens of new bioethanol plants in Indonesia.
“The kickoff of this programme means we are still in discussions with all stakeholders to determine the specific specifications required for blending into petrol. There are specific standards involved,” she concluded.
E10 Target for 202lar 27
Previously, the Minister of Energy and Mineral Resources, Bahlil Lahadalia, stated that the E10 fuel implementation would take place in 2027, followed by E20.
“E10 might be in 2027, and then we will move directly to E20. The goal is to proceed once the planning is complete. We will do this gradually, following the strategy used for B10, B20, B30, up to the current B50,” Bahlil said at the State Palace recently.
Bahlil explained that the study for the E20 mandate has been underway since 2025 and is nearing completion. The new planning is expected to be implemented around 2028–2029.
“Why? Because once we implement the ethanol mandate, we can achieve efficiency and savings on fuel imports for petrol. However, we do not want to implement E20 only to end up importing the ethanol,” Bahlil said.
To this end, Bahlil noted that the government intends to prioritise the development of the bioethanol industry first. This industrial preparation is planned to take place over the next one to two years, utilising raw materials such as cassava, sugarcane, maize, and other commodities.
“We do not want to implement E20 only to import the ethanol. Therefore, we are currently preparing the industry first,” he said.