New B50 Fuel Launches, BPDP Incentives to Decrease

Jakarta, CNBC Indonesia - The Ministry of Energy and Mineral Resources (ESDM) has revealed that funds provided from the Plantation Fund Management Agency (BPDP) for the 50% biodiesel (B50) programme will decrease, from a previously calculated Rp 47 trillion per year to Rp 32 trillion.

Director General of New, Renewable Energy, and Energy Conservation (EBTKE) at the Ministry of ESDM, Eniya Listiani Dewi, stated that the higher price of diesel has created a price difference situation where diesel is more expensive than biodiesel, meaning incentives are no longer provided.

“It has decreased. Previously it was around Rp 47 trillion (from BPDP), now it becomes Rp 32 trillion,” she said when met at the Office of the Coordinating Ministry for Economic Affairs in Jakarta on Thursday (18/6/2026).

Consequently, the BPDP funds partially used for the B50 programme have been reduced by up to Rp 15 trillion because the incentives for the programme have been halted under current conditions.

“If it’s the total calculation, yes, the total calculation shows a reduction. Because the price difference means the incentive is not there. Because the diesel price is higher, so FAME actually helps, because the difference that was paid was the shortfall, now it’s more, so there is no incentive,” she added.

Eniya mentioned that incentives for the B50 biodiesel blend were stopped starting in April 2026 because the price of crude oil, particularly diesel, has been higher than the price of FAME since then.

This condition is expected to persist until June 2026 due to the still higher diesel price. Eniya said her party continues to monitor fluctuations in global crude oil prices, which could affect the subsidy budget for the remainder of 2026.

Despite the incentives currently not being provided, the government has confirmed the mandatory B50 launch scheduled for 1 July 2026.

“That depends on the oil price later. But we calculate it is still somewhat rising, the diesel price is somewhat high. Our calculation is that the incentive will only be around Rp 32.3 trillion for a year,” Eniya continued.

The government is currently finalising a Ministerial Decree (Kepmen) regarding the determination of the B50 allocation volume for the second half of this year. This regulation will serve as the legal basis for all business entities to implement the mandatory 50% palm oil blend to strengthen national energy security.

“It will be calculated in the Minister’s Kepmen. So it will be included in the Minister’s Kepmen. It’s already calculated, just waiting for the signature,” she concluded.