I'm pissed with this news. Btw, the claim is the lawmaker is holding up in the event of the upcoming election.
The government is trying to underpin a weak biofuels industry which has been hard hit by low oil prices and recent fluctuations in the price of palm oil, which has fallen 39 percent from its cyclical high. Only bioethanol from sugar cane or cassava can now reach the market without subsidies whereas biodiesel from palm oil and jatropha financial props if Pertamina is to continue distribution. That is happening at a time when the world's environmentalists are increasingly critical of biofuels production, charging that diversion of agricultural lands from food to fuels is driving up food costs and risking starvation for the world's poor.
But Indonesia appears determined to push forward, even if it is staggering – and there is little doubt of that. Hilmi Panigoro, Chairman of the Indonesian Renewable Energy Society, whose family founded the Medco Group, which is involved in oil and gas and energy, recently criticized the lack of follow-up after initial euphoria on biofuel development in 2006.
Panigoro was quoted as saying at a biofuels workshop in Jakarta earlier this month as saying investors are now confused and discouraged. His main criticism alleged a lack of clear government coordination and failure to provide effective leadership to drive all the related stakeholders into action.
Unggul Priyanto, director of energy resource development at the Agency of Assessment and Application of Technology (BPPT) agreed that "Biofuel development is just floating around without leadership".
The now defunct National Team for Biofuel Development previously had no authority to enforce policy. This related to a more fundamental problem, exacerbated by the negative impacts of the global economic slowdown, as to how Indonesia could make the transition from a command economy led by an authoritarian figure like Suharto to a modern democracy led by President Susilo Bambang Yudhoyono and still succeed in pushing new energy policies through the complex decentralized state bureaucracy, at the same time attracting investors.
The government has mandated that by 2025 biofuel consumption must contribute at least 5 percent to the national energy mix, from less than 1 percent now. But the country is only producing biofuels at 10 percent of existing capacity, while power stations prepared to use biodiesel cannot obtain reliable supplies.
Meanwhile, Indonesian lawmakers are holding back their agreement to the new subsidy policy amidst murmurs about collusion with producers and heightened sensitivities on government fuel and energy subsidies during the run up to the Indonesian general elections in April and presidential elections in June."
"Pertamina has been ordered by the government to mix at least 1 percent biopremium fuel with subsidized gasoline and up to 5 percent of biosolar with subsidized diesel. The average subsidy works out at Rp1,000 per liter (about US$10¢) but this is only paid out when the biofuel price is higher than the fossil fuel price.
But Indonesia appears determined to push forward, even if it is staggering – and there is little doubt of that. Hilmi Panigoro, Chairman of the Indonesian Renewable Energy Society, whose family founded the Medco Group, which is involved in oil and gas and energy, recently criticized the lack of follow-up after initial euphoria on biofuel development in 2006.
Panigoro was quoted as saying at a biofuels workshop in Jakarta earlier this month as saying investors are now confused and discouraged. His main criticism alleged a lack of clear government coordination and failure to provide effective leadership to drive all the related stakeholders into action.
Unggul Priyanto, director of energy resource development at the Agency of Assessment and Application of Technology (BPPT) agreed that "Biofuel development is just floating around without leadership".
The now defunct National Team for Biofuel Development previously had no authority to enforce policy. This related to a more fundamental problem, exacerbated by the negative impacts of the global economic slowdown, as to how Indonesia could make the transition from a command economy led by an authoritarian figure like Suharto to a modern democracy led by President Susilo Bambang Yudhoyono and still succeed in pushing new energy policies through the complex decentralized state bureaucracy, at the same time attracting investors.
The government has mandated that by 2025 biofuel consumption must contribute at least 5 percent to the national energy mix, from less than 1 percent now. But the country is only producing biofuels at 10 percent of existing capacity, while power stations prepared to use biodiesel cannot obtain reliable supplies.
Meanwhile, Indonesian lawmakers are holding back their agreement to the new subsidy policy amidst murmurs about collusion with producers and heightened sensitivities on government fuel and energy subsidies during the run up to the Indonesian general elections in April and presidential elections in June."
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