Observer: Government Must Anticipate B50 Biodiesel Supply Chain Availability
Jakarta (ANTARA) - Ali Ahmudi Achyak, Executive Director of the Center for Energy Security Studies (CESS), has said the government must anticipate the sustainability of raw material supply chains for B50 biodiesel.
“Going forward, the biggest challenge is no longer the blending of B50, but rather how to guarantee biodiesel supply, strengthen distribution, regulate procurement mechanisms, and maintain product quality across the entire supply chain,” Ali said in a statement received in Jakarta on Monday.
Ali explained that raising the biodiesel composition from B40 to B50 is not merely a nominal 10 per cent increase.
In terms of volume, he said, the additional blend would significantly reduce gasoil consumption, potentially curbing the fuel imports that Indonesia still requires.
According to Ali, experience from implementing B20, B30 and up to B40 provides an important foundation for rolling out B50. Based on his observations at various fuel terminals and biodiesel producer facilities across Indonesia, he assessed that blending infrastructure readiness is already quite good.
Nevertheless, Ali cautioned that the success of B50 depends not only on distribution infrastructure readiness, but also on the sustainability of the biodiesel supply chain.
He hopes the government will ensure the availability of supporting raw materials for biodiesel production, such as methanol and other chemicals, which are key components in processing palm oil into biodiesel.
Ali believes the government needs to begin anticipating the high utilisation rate of national biodiesel plants, which has already exceeded 80 per cent. This leaves increasingly limited room for production increases, so developing new plant capacity and reallocating production should be prepared early on.
Beyond ensuring sufficient supply, Ali also highlighted the importance of overhauling the distribution system to bring down biodiesel logistics costs.
In his view, a more efficient distribution pattern would keep biodiesel prices competitive whilst maintaining product quality until it reaches the public.
“If managed well, B50 will become an important foundation in the national energy diversification strategy towards energy independence,” Ali said.
Minister of Energy and Mineral Resources Bahlil Lahadalia said the government will build a methanol industry in East Java and East Kalimantan to meet the needs of the B50 biodiesel programme.
Bahlil said the government will hold the groundbreaking for the methanol industry in Bojonegoro, East Java, in July 2026. The methanol plant to be built in Bojonegoro will use gas as its feedstock.
The government will also build a methanol industry in East Kalimantan using coal as feedstock.
With these projects, he hopes Indonesia can meet its methanol requirements for the B50 programme.