Indonesia and the United States signed a reciprocal trade agreement on Friday, February 20, 2026, that includes provisions for the import of U.S. Ethanol. The agreement, known as the Agreement on Reciprocal Trade (ART), outlines specific commitments regarding bioethanol trade between the two countries.
According to the final ART document, specifically Annex III (Article 2.23), Indonesia is prohibited from adopting or maintaining any measures that would prevent the import of bioethanol from the U.S. This commitment aims to facilitate increased trade of the renewable fuel source.
SCROLL TO CONTINUE WITH CONTENT
The agreement also stipulates that Indonesia must blend its gasoline with at least 5% bioethanol (E5) by 2028 and 10% bioethanol (E10) by 2030. Indonesia is expected to work towards a 20% bioethanol blend (E20), taking into consideration supply and infrastructure capabilities.
|
Ilustrasi etanol Foto: Pertamina
|
Annex IV, point B number 2 of the agreement, details a specific import quota. Indonesia is required to import more than 1,000 metric tons (1 million kg) of ethanol from the U.S. Annually. This equates to approximately 1.2 million liters, though the precise volume may vary based on temperature and ethanol concentration.
The ethanol import agreement raises questions given the Indonesian government’s previous mandate requiring all gasoline to contain 20% ethanol (E20) by 2028. This earlier policy was intended to reduce Indonesia’s reliance on fuel imports and, according to reports, included potential incentives for domestic ethanol production.
“Until the chickens grow teeth, if we aren’t creative in doing this (ethanol blending), we won’t be able to do it all domestically,” said Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia.
Meanwhile, PT Pertamina and PT Sinergi Gula Nusantara (SGN) are currently constructing a bioethanol plant in Glenmore Sugar Factory, Banyuwangi Regency, East Java. The facility is projected to produce 30,000 kiloliters of bioethanol per year using sugarcane as a feedstock.
(sfn/lth)
