Wednesday, August 6, 2008

[PBN] Indonesia forces industry to use biofuels

From: Bio Fuels International - 31/07/2008

The Indonesian government plans to implement a decree that would force manufacturers to obtain 2.5% of their energy needs from biofuels.

The country wants to wane its dependence on imported fossil fuels and intends to cut its massive spending on fuel subsidies. Indonesia heavily subsidizes diesel in particular, which takes up an increasingly large chunk of the government budget with fuel prices rising in the global market. A spokesperson of the Ministry of Energy's biofuel taskforce said that a decree would be issued in October stipulating that factories use palm oil and other cleaner burning fuel for 2.5% of their total needs.

Indonesia is currently the world's biggest producer of palm oil, but while the government sees the decree as a way to alleviate poverty and create more jobs, some worry that it will push up the price of palm oil which is widely used by the poor for cooking. Another concern is that increased palm oil demand will lead to further destruction of Indonesia's rainforests to create new plantations.


No comments: