Indonesia Invites Private Firms to Build Ethanol Plants for E20 Push

(Antara) The Ministry of Energy and Mineral Resources is opening opportunities for private companies interested in building ethanol plants following the mandatory target of blending 20 percent bioethanol into gasoline (E20) by 2028.

"So, private companies are allowed, and we strongly encourage them to build these (bioethanol) plants," said Eniya Listiani Dewi, Director General of New, Renewable Energy, and Energy Conservation at the Ministry, in Jakarta on Monday.

Furthermore, Dewi stated that this is also being encouraged by the government through discussions on the revision of Presidential Regulation Number 40 of 2023 concerning the Acceleration of National Sugar Self-Sufficiency and the Provision of Bioethanol as a Biofuel.

She said the revised regulation will later regulate blending capacity.

"Regarding capacity, we also added blending to the revised Presidential Regulation 40. So, yesterday and today, I instructed our team to communicate with the Coordinating Ministry for Economic Affairs because they initiated the revision there. We are adjusting to President Prabowo Subianto's direction to add that," Dewi said.

She estimated that the physical construction of an ethanol plant would likely take only 1.5 years.

However, Dewi acknowledged that rapid construction also requires the readiness and availability of local raw materials.

"Well, it's just the raw materials. If the factory is built, it can be finished in 1.5 years, but the raw materials must also be carefully prepared," she added.

Previously, President Prabowo Subianto planned to increase the number of ethanol plants in Indonesia, building at least 30 to 50 plants in an effort to develop fuel oil with ethanol blends.

President Prabowo announced on Friday that Indonesia can now blend gasoline with ethanol up to a 20 percent level, or E20.

"Earlier, officials said we could reach E20. We need a factory. We only have one factory. I decided earlier that we will build at least 30 factories, and if necessary, up to 50," he said.

The Head of State cited India achieving E20 and Brazil achieving E100 as positive examples.

Looking at these two countries, he expressed optimism that Indonesia can achieve its target of reaching E20. READ MORE

Excerpt from Antara: Energy and Mineral Resources (ESDM) Minister Bahlil Lahadalia is pushing for the implementation of the B50 biodiesel and E20 bioethanol programs as a key strategy to achieve national energy self-sufficiency.

Accelerating the adoption of biofuels, alongside optimizing oil lifting, is part of the government’s broader efforts to address the global energy crisis triggered by the war in the Middle East.

“First, we must optimize our oil lifting. Second, we need diversification, such as B50, which can reduce diesel imports. Third, we must also push forward the E20 program,” Bahlil said at the Merdeka Palace on Monday (April 27, 2026).

To support this initiative, the ESDM Ministry plans to begin bioethanol production in 2027 in Merauke, South Papua. The program is linked to the government’s flagship food estate initiative, which aims to develop 500,000 hectares of sugarcane plantations.

In addition to biofuel development, the Indonesian government is also studying the use of compressed natural gas (CNG) as an alternative to reduce reliance on imported liquefied petroleum gas (LPG), which still dominates domestic supply. READ MORE

Excerpt from Antara: State Secretary Minister Prasetyo Hadi informed that Abdulrachman Saleh Air Force Base serves as a model of integrated sugarcane ecosystem development from upstream to downstream.

The sugarcane used for bioethanol is sourced from plantations managed by the Indonesian Air Force, including those within Abdulrachman Saleh Air Force Base, while the processing is carried out by PT Sinergi Gula Nusantara (SGN) and Pertamina NRE.

"Abdulrachman Saleh Air Force Base in Malang serves as an example of integrated sugarcane ecosystem development. Besides sugar production, sugarcane is also processed into bioethanol, environmentally friendly fuel, organic fertilizer, and various value-added industrial products for energy security and the national industry," Hadi remarked.

During the visit, President Prabowo also reviewed food crop production, assisted by the Indonesian Army for rice, the Indonesian Navy for soybeans, and the Indonesian Air Force for sugarcane.

According to Hadi, Prabowo also inspected downstream sugarcane products, including sugar and bioethanol, which were exhibited at the event location. READ MORE

Excerpt from Antara: The National Research and Innovation Agency (BRIN) has identified sugar palm (aren) as a highly viable, sustainable alternative for national bioethanol production.

The crop offers simplified processing, a high octane rating, and the ability to thrive on marginal land without competing with food crops, according to a researcher at BRIN’s Biomass and Bioproducts Research Center, Saptadi Darmawan.

Speaking at the Center for Sustainable Forest Development in Bogor, Friday (June 26), Saptadi explained that sugar palm sap is a relatively easy raw material for bioethanol as it contains high levels of sucrose, glucose, and fructose.

Unlike bioethanol derived from starch or wood biomass, which requires complex processing, bioethanol from sugar palm sap can be produced simply through fermentation and distillation, he explained.

Furthermore, he noted that sugar palm-based bioethanol boasts an octane rating of around 108, which is higher than standard high-octane gasoline.

Sugar palms can also produce sap for up to 20 years, making them a highly sustainable source of renewable energy.

“Its economic value is quite good. It is also renewable,” Saptadi stated.

According to him, sugar palms can be grown on marginal or less productive agricultural land, ensuring that the energy crop does not compete directly with food commodities.

In terms of environmental benefits, the plant contributes to conservation efforts because its extensive root system helps maintain soil and water quality, reduces the risk of erosion, and produces nectar for bees.

However, Saptadi acknowledged that the development of sugar palm bioethanol still faces several challenges, including the need to further standardize the quality of raw materials and the production process.

Additionally, in some regions, sugar palm sap competes with its use as a raw material for traditional alcoholic beverages, which carry a higher economic value.

As a concrete step toward developing sugar palm-based bioenergy, the Forestry Ministry has inaugurated the Sugar Palm Bioethanol Pilot Plant at Pertamina Geothermal Energy (PGE) Kamojang, Garut, West Java, in December 2025.

The pilot project utilizes sugar palm sap supplied by the Baru Bojong Social Forestry Business Group (KUPS), operating with a production capacity of approximately 300 liters of bioethanol per day from 300 to 500 kilograms of sap.

The ministry estimates that one hectare of sugar palm plantations can produce around 24,000 liters of bioethanol per year to support national energy demands. READ MORE