Mandatory Ethanol Fuel Set for Implementation in Indonesia, Yet Opposed in the US

KatadataOTO – The implementation of gasoline mixed with ethanol will be enforced in Indonesia as part of efforts to reduce exhaust emissions.

The decision has certainly drawn pros and cons from various parties. This is because it requires thorough preparation in terms of both the ecosystem and the vehicles sold domestically.

Recently, the United States also experienced a similar issue. The American Petroleum Institute (API) disagrees with the expansion of the mandatory 15 percent ethanol-blended gasoline, or E15.

Previously, the applicable ethanol gasoline there was E10. The API highlighted several obstacles that need attention if the ethanol percentage is increased to 15 percent.

Photo : Pertamina

According to an API representative, they are not entirely opposed to E15 gasoline. However, the policy must be balanced with other regulations amidst this fuel change.

For example, small refineries should not receive exemptions from ethanol fuel regulations. Because it would negatively impact those who have invested to comply with the rules.

The API also suggested import incentives for renewable fuels, including ethanol, if the government wishes to proceed with implementing E15.

From a refinery's perspective, the E15 policy could increase compliance costs and disrupt fuel refining operations.

On the other hand, traditional corn and ethanol producers are actually pushing for E15 sales because it is profitable.

Preparations in Indonesia Not Yet Mature

The obligation to sell ethanol-blended fuel in the near future has also drawn reactions from manufacturers.

Japanese brands like Toyota claim their vehicle lineup, especially the latest productions, are ready for the ethanol policy.

However, they highlight the need for transitional regulations before mass implementation. Especially since many vehicles on the road are not compatible with ethanol.

Photo : Special

Toyota also stated that importing ethanol as an initial stage is reasonable, while waiting for the domestic industry's readiness to supply the material.

“Our neighboring countries have all started (using ethanol-blended gasoline). So we are falling behind,” said Bob Azam, Vice President Director of PT Toyota Motor Manufacturing Indonesia, some time ago.

He further revealed that Toyota's car lineup can already accommodate ethanol-blended fuel up to 20 percent, or E20.