Indonesia to Issue Carbon Credit Certificates to International Buyers

Indonesia is set to launch carbon credit certificates for international buyers on Monday, January 20, as part of its effort to fund initiatives supporting its carbon neutrality goals. The move aims to leverage the country’s status as an archipelago with the world’s third-largest rainforest area, even as it remains one of the top 10 global greenhouse gas emitters. The certificates will be derived from emission reductions achieved by several power projects on Java island, accounting for 2.48 million metric tons of carbon dioxide equivalent (CO2e), according to the Ministry of Environment, as reported by state news agency Antara.

Indonesia introduced carbon emission credit trading for domestic participants in September 2023, but the market has remained largely illiquid due to limited supply and demand. By the end of December 2024, the trading value had reached 50.64 billion rupiah (US$3.10 million), with a trading volume of 908,018 tons of CO2e, data from Indonesia's Financial Services Authority shows.

Newly elected President Prabowo Subianto is focused on leveraging carbon offset sales as a means of raising funds. Last year, he expressed optimism about Indonesia achieving net zero emissions by 2050, a full decade earlier than previously targeted. Key measures include phasing out coal-fired power plants, alongside expanding carbon trading mechanisms to the international market.