Indonesia’s biodiesel consumption to reach 5.1 million kiloliters in 2016

Indonesia’s consumption of palm oil-based biodiesel may surge to 5.1 million kilolitres in 2016, from 1.5 million kiloliters this year, Bayu Krisnamurthi, head of Indonesia’s palm oil sustainability fund, said.

About 2.5 million kilolitres of next year’s consumption would be in the form of subsidised biodiesel, while the remaining 2.6 million kilolitres would be non-subsidised.

State-owned PT Pertamina will sell the biodiesel at its retail outlets.

However, Indonesia’s subsidised biodiesel consumption is projected to decline to 765,000 kilolitres this year, from 1.2 million kilolitres in 2014, as the government’s biodiesel subsidy was implemented only in mid July. It established a palm oil sustainability fund, which gets its funding from a levy on palm oil exports, to subsidise biodiesel. Indonesia is the largest producer of palm oil.

The government also raised the biodiesel content in diesel fuel to 15% this year from 10%.