Indonesia Launches World's First B50 Biodiesel, Saving Rp 170 Trillion in Foreign Exchange

President Prabowo Subianto officially launched B50 biodiesel, a fuel consisting of 50% palm oil-based Fatty Acid Methyl Ester (FAME) blended with diesel, at a Pertamina petrol station in Karawang, West Java, on Thursday. This marks an increase from the previous B40 mandate, which had been in effect since early 2025. The launch is a strategic government initiative aimed at reducing reliance on imported fuel, enhancing the value of national natural resources, and safeguarding Indonesia’s economic resilience and energy sovereignty. The event was attended by Energy and Mineral Resources Minister Bahlil Lahadalia, Investment and Downstreaming Minister Rosan Roeslani, Coordinating Minister for Economic Affairs Airlangga Hartarto, and Pertamina executives. In his speech, President Prabowo stated that with this programme, Indonesia becomes the first country in the world to implement a B50 biodiesel mandate, proving the nation’s ability to harness its own natural wealth for the benefit of its people. He described the launch as a significant milestone in the journey towards energy independence, emphasising that a nation’s survival depends on its capacity to produce its own food, energy, and water. Minister Bahlil Lahadalia reported that the B50 mandate would save the country Rp 170 trillion in foreign exchange, a significant increase from the Rp 133.3 trillion saved under the B40 policy. He noted that for the first time, Indonesia would no longer need to import diesel. The minister also highlighted that the programme would increase the added value of the crude palm oil (CPO) industry to Rp 23.49 trillion, up from Rp 20.92 trillion, and boost employment to 2.1 million jobs. The demand for FAME is expected to rise to between 16.7 and 18 million kilolitres, with CPO requirements increasing to 15.2–16.3 million tonnes. The B50 fuel sold at Pertamina petrol stations is priced at Rp 6,800 per litre, the same as the current subsidised diesel price. The mandate applies to both subsidised and non-subsidised fuel across various sectors, including mining, agriculture, fisheries, railways, and marine transport. The economic price of diesel currently ranges from Rp 19,000 to Rp 21,000 per litre, while the biodiesel component is priced based on a government-set formula. For July 2026, the biodiesel market index price was set at Rp 14,562 per litre plus transport costs.