JAKARTA, Oct. 24 — Indonesia will offer incentives to companies building ethanol plants in the country to support the government’s plan to implement a 10-percent bioethanol fuel blend (E10) by 2027, Energy and Mineral Resources Minister Bahlil Lahadalia said on Friday.
“There will definitely be incentives. There could be a tax holiday, and then there will be a market,” Lahadalia told reporters, adding that investors from Brazil are considering building ethanol factories in Indonesia.
Indonesia and Brazil on Thursday signed a series of memorandums of understanding to strengthen cooperation in energy, mining, agriculture, science and trade, according to a statement from the Indonesian Presidential Secretariat.
“There’s a big possibility of Brazilian investors coming in,” Lahadalia said, noting that implementing E10 by 2027 would require around 1.4 million kiloliters of ethanol as raw material.
The minister said his ministry is working to ensure domestic production can meet this demand without relying on imports.
He said cassava and sugarcane will be the main raw materials for ethanol production, which will also generate employment and stimulate local economies.
“This will create many jobs for the farming community.
There needs to be a process, mechanization and technology, so regional economies can grow. Once the planting is complete, we’ll build the ethanol factory,” he explained.
Lahadalia earlier said that a sugarcane-based ethanol plant is expected to be built in Merauke, South Papua, while a cassava-based ethanol plant is still in the planning stage. (Xinhua)
