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I. Executive Summary : Indonesian Ministry of Energy and Mineral Resources (MEMR) Regulation No. 25/2013 is an ambitious biofuel program that aims to diversify domestic biodiesel consumption beyond the transportation sector (Indonesia’s main biodiesel consumer). Challenges to expand biodiesel expansion include inadequate infrastructure, producer and blender disagreement on biofuel price index formulation, and the absence of strong political will to remove or cut fuel subsidies.

II. Policy and Programs The GOI enacted Indonesia’s National Energy Policy (Presidential Regulation No. 5/2006 (regulation 5) in early 2006. Regulation 5 formalized the development of biofuels in Indonesia, (ethanol and biodiesel), and established a five percent biofuel mandate by 2025. According to regulation 5, biofuel development, as well as other new and renewable energies1, will help diversify and secure energy supplies and support sustainable economic development.

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