Prospects of CCS for Indonesia: Potential to Boost GDP by 0.84% and Become a Regional Carbon Hub
Carbon Capture and Storage (CCS) or carbon capture and storage technology is emerging as one of the strategic solutions that not only contributes to emission reductions but also has the potential to open new business opportunities and drive national economic growth.
At the Katadata ESG Forum held on Monday (6/4/2026), the Executive Director of the Indonesia Carbon Capture and Storage Center (ICCSC), Belladona Maulianda, emphasised that CCS can serve as a strategic bridge that transforms environmental obligations into new revenue streams. This technology is assessed to provide significant contributions to the national economy.
Based on ICCSC’s internal calculations, the implementation of CCS in Indonesia has the potential to contribute 0.84% growth to Gross Domestic Product (GDP) by 2030. This projection is supported by pre-project investment commitments worth US$43 billion (equivalent to Rp732 trillion) spread across 19 strategic projects in various regions.
“CCS is no longer just an effort to fulfil the environmental pillar, but also creates a multiplier effect. In addition to driving GDP growth, this sector is predicted to absorb around 224,000 workers annually,” said Belladona.
One of the advantages of CCS integration is its ability to encourage the birth of low-carbon based downstream industries, such as low carbon LNG, blue methanol, blue ammonia, and blue hydrogen.
According to her, these products have high appeal in the global market. Their more environmentally friendly status allows “blue” products to be sold at a premium price.
“The margins are larger because they can be sold at a premium price, while also fulfilling environmental obligations and supporting the government’s planned industrial downstreamisation targets,” she added.
Indonesia is also considered to have a comparative advantage to become a major CCS player in Southeast Asia. With underground storage capacity potential of around 600 gigatons, Indonesia has the opportunity to become a carbon storage hub for countries with high emissions but limited land, such as Singapore, South Korea, and Japan.
From a regulatory perspective, Indonesia is relatively more advanced with the issuance of Presidential Regulation No. 14 of 2024, which regulates cross-border CCS. The business schemes are also diverse, ranging from transportation and storage fees (storage fee) to opportunities as an aggregator for large industrial companies.
Belladona likened this dynamic to a carrot and stick strategy. When other countries begin implementing high carbon taxes (stick), Indonesia offers economically valuable carbon storage solutions (carrot).
Currently, Indonesia is developing around 15 CCS/CCUS projects targeted to operate before 2030. These projects are mostly in the oil and gas sector, from Sumatra to Papua, as well as heavy industries, as part of efforts to achieve net zero emission targets. The government has also issued Ministry of Energy and Mineral Resources Regulation No. 2 of 2023 to regulate operations while attracting investments.
Although the prospects are significant, Belladona reminded that CCS is a high risk, high return industry. Therefore, the role of the financial sector is crucial, particularly in designing optimal financing schemes and insurance support as an enabler.
In addition, transparency and accountability in emission reporting are key factors so that CCS projects can produce carbon credits with high economic value.
“We need collaboration from three stakeholders: the government through regulations, industry players through business models, and financial institutions to ensure this investment provides optimal returns,” she concluded.
With strong regulatory support, investment, and collaboration, CCS has the potential to become one of the new engines of economic growth as well as an important instrument in achieving net zero emission targets without sacrificing Indonesia’s global competitiveness.