Indonesia is boosting B30 program utilization to improve palm oil consumption, slash fuel imports, and narrow a yawning current account gap - Photo: Privacy.

JAKARTA (TheInsiderStories) – Indonesian government sees to increase the portion of diesel blended with crude palm oil from the current 20 percent bio-content (B20) to 30 percent (B30) starting October this year and to 100 percent (B100 ) in five years. The government claims the B30 mandatory will raise palm oil consumption and reduce fuel imports.

Coordinating Minister for the Economy Darmin Nasution told reporters recently that B30 was still in the testing phase and would end in the mid-this month. The government sees the use of B30 will reduce diesel consumption by up to three million kiloliters (kl).

“After the trial process is complete, we immediately use it. So we predict in October, not later than November,” he said on Thursday (08/29), adding that the B30 will free the country from the pressure of major European countries on palm oil.

The minister adds that the government is also preparing an investment to produce B100 or green diesel which is targeted to begin within the next five years. The B100 program is expected to reduce diesel consumption by up to seven million kl.

“If the investment starts, green diesel production should be pursued within three years and its use can be used in the next five years. Not only biodiesel but also Avtur can be generated from the investment of the refinery,” he said.

He also said as many as 10 Indonesian palm oil companies, from seven companies earlier, committed to participate in the B100 production plan from previously only seven companies, and it was hoped that within the next three years the country would be able to produce green diesel independently.

Furthermore, the green diesel will be mixed with B30 which is expected to produce B50 or B60.

“Later, if we have carried out B30 early next year, after that we will not talk about B40, but we hope that three years from now the green diesel has begun to be produced so that B100 with B30 if mixed will get B50, then B60,” he explained.

Nasution, however, could not yet state how much the target of the B100 production size would be in the next three years. However, in the first three years of green diesel production, the amount is expected to be sufficient to produce at least B50.

For this reason, the minister said, further discussions were needed with a number of companies committed to producing the green diesel.

At different places, the chairman of the Indonesian Automotive Industries Association, Yohanes Nangoi, said domestic car manufacturers were ready to implement a mandatory policy on the use of B30.

“The bottom line is that most brand holder agents can accept it. They make adjustments and there is no problem. Now there are 10 brands that carry out the B30 test. In addition, the types of vehicles are more varied, including trucks, pickups, and passengers will try a test,” he told reporters days ago.

Month ago, President Joko Widodo has announced that he wants the country accelerates the mandatory B30 and expecting to save US$5.5 billion per year in fuel imports.

According to the minister for energy and mineral resources Ignatius Jonan, from January to July, the country consumed around 2.95 million kl of fatty acid methyl ester (FAME). The country hopes to consume 6.2 million kl of FAME over the full year and 9.6 million kl in 2020.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com