In order to support the achievement of Indonesia’s NDC greenhouse gas (GHG) emissions reduction targets and to implement the provisions of Presidential Regulation Number 98 of 2021 on the Implementation of Carbon Pricing to Achieve the Nationally Determined Contribution Target and Control Over Greenhouse Gas Emissions in National Development, this Regulation introduces the procedure for implementing carbon pricing in Indonesia. Carbon pricing applies to the following sectors: energy; waster; industrial processes and product uses; agriculture; forestry; and other sectors in accordance with developments in science and technology. The implementation of the carbon pricing is carried out through the following mechanisms: carbon trading; result-based payments; and carbon levies, as well as other mechanisms that accord with developments in science and technology. Carbon trading may be carried out through domestic and international trading procedures. The Regulation sets out the provisions of a Carbon Trading Roadmap, which carbon trading activities must comply with, and establishes the rules for offsetting GHG emissions from activities that are either uncapped or do not meet the sectoral GHG Emission Baseline.
The Regulation further outlines the procedures for Result-Based Payments and the Carbon Levy.
