Indonesia to make ethanol-blended fuel mandatory by 2028: Minister
Indonesia will mandate ethanol-blended fuel by 2028, with plans for a compulsory E10 blend approved by President Prabowo. The government is drafting a roadmap, considering tax incentives, and encouraging investment in ethanol plants to cut emissions and fuel imports.
Indonesian Minister of Energy and Mineral Resources, Bahlil Lahadalia, has announced that the use of ethanol-blended fuel will become mandatory by 2028 at the latest. “I assure you, no later than 2028, there will be a compulsory requirement for bioethanol—perhaps in 2027-2028,” Bahlil said, as reported by Antara on Friday, January 9, 2026.
He added that the government is currently preparing a roadmap for the implementation of bioethanol. Meanwhile, Eniya Listiani Dewi, Director General of New Energy, Renewable Energy, and Energy Conservation (EBTKE) at the Ministry of Energy and Mineral Resources, noted that excise tax matters related to ethanol have been discussed with the Coordinating Ministry for Economic Affairs.
As per the news report, Eniya explained that the Ministry of Finance has granted an excise tax exemption for ethanol used in biofuel, but this benefit applies only to businesses holding commercial permits. She cited Pertamina, which already possesses a commercial trading permit (IUN), exempting it from paying ethanol excise tax. “We are currently discussing whether the revision of Presidential Regulation 40 (2023) on the Acceleration of National Sugar Self-Sufficiency and Bioethanol will include tax relief,” Eniya said.
Earlier, Bahlil mentioned that President Prabowo Subianto has approved a mandatory 10 percent ethanol blend in fuel oil, aligning with the government’s goal of reducing carbon emissions and reliance on imported fuel.
To support the rollout of the mandatory E10 blend, Bahlil stated that incentives will be offered to companies constructing ethanol plants in Indonesia. Deputy Minister of Investment and Public Enterprise, Todotua Pasaribu, added that global automotive giant Toyota is looking to invest in Indonesia to help meet the country’s bioethanol demand.
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Source : Chinimandi
