In this issue of our “In Conversation with” we are pleased to share some insight into the activities the Indonesian Ministry of Industry is undertaking in order to improve the fuel emission standards in South-East Asia’s biggest economy. We had the pleasure to talk to Ir. Haijanto, Director General of Metal, Machinery, Transportation Equipment and Electronics Industry, Ministry of Industry. We would like to thank Ir. Haijanto for his efforts in comprehensively answering our questions.
IR. HARJANTO, M.ENG Director General of Metal, Machinery, Transportation Equipment and Electronics Industry Ministry of Industry of the Republic of Indonesia
Ir. Harijanto M.Eng is the Director General the Metal, Machinery, Transportation Equipment and Electronics Industry Division in the Ministry of Industry. Prior to his current position Ir. Harijanto has been in a number of similar positions in other Ministry of Industry divisions. He has also acted as the Industry Attaché at the Indonesian Embassy in Brussels, prior to which he was holding an assignment at the Indonesian embassy in Washington. He has also acted as the President Commissioner of PT. KHI Pipe Industries and as Commissioner of PT. Krakatau Steel (Persero), Tbk. For the last two years, he is the President Commissioner of PT. Semen Baturaja (Persero), Tbk. Ir. Harijanto holds a master’s degree in Mechanical Engineering from Keio University.
Q: Could you please give us a brief summary of Indonesia’s plans for future emission standard developments – what is the current planned schedule for implementation of improvements? Will legislation be imposed by October 2018 as suggested?
A: In March 2017, the Indonesian government issued the Ministry of Environment and Forestry Regulation No. P.20/MENLHK/SETJEN/KUM. 1/3/2017 on the Standard Exhaust Emission of Motor Vehicle Category M, N, and O (Euro 4). Based on this regulation, by October 2018 the production of motor vehicle fuelled by gasoline, CNG and LPG must comply with Euro 4 standard, while for Diesel fuels the production must comply by April 2021.
PT. Pertamina (Persero), has prepared Pertamax Turbo RON 98 to comply with Euro 4 regulation, although the fuel specification of RON98 has not yet been issued by the Ministry of Energy (ESDM).
Currently, PT. Pertamina (Persero) has 754 retail outlets that provide Pertamax Turbo on nationwide, except Kalimantan and Papua island. The company has distributed low Sulphur fuel (Pertamax Turbo RON 98) to 371 outlets in DKI, Banten and West Java provinces.
In addition, Pertamina will accelerate the distribution of low Sulphur fuel (Pertamax Turbo RON 98) in other targeted cities like Palembang, Surabaya, Banyuwangi, Denpasar, Makasar, in order to support ASIAN GAMES and IMF-World Bank meeting in Bali.
Q: What environmental and economic benefits do you expect from implementing these standards?
A: Implementation the Euro 4 standard emission will improve Indonesia’s air quality index, reduce the effect of GHG (Green House Gas) emissions and improve public health. From an economic point of view, this regulation will increase efficiency of the automotive industries since they do not need to make double variant/spec for domestic market and export market, and for customers they will get more efficient fuel consumption for their vehicle.
Q: How will these expected benefits fall in line with overall government objectives set out by President Jokowi?
A: At the COP 21 (“Conference of Parties”, Sustainable innovation Forum, Paris 2015), Indonesia, as one of the world’s biggest carbon polluters has committed itself to cut greenhouse gas emissions by 29% by 2030 from a ‘business as usual trajectory’. This commitment reflects the government objective to achieve sustainable development goals for its people and the planet. Transportation sector plays a significant role in improving air quality index through the enforcement of more stringent emission standards including Euro 4 standard for motor vehicle.
Q: How will the auto industry shape up for these improvements? Will Indonesian vehicle specifications be able to meet this standards? How will the Indonesian auto industry thrive under these standards?
A: Most of Indonesia’s automotive industry companies which are member of GAIKINDO are ready to produce motor vehicles that comply with Euro 4 standards by the end of September 2018, except for certain models (4 companies/6 vehicle models). These companies/models have been granted an extension for 6 months, up until April 2019.
Q: What potential roadblocks or delays does the Indonesian government envisage that might affect the proposed implementation?
A: The main issue is the readiness of the distribution of the fuel nationwide, because GAIKINDO propose that the fuel should be distributed nationwide before actual implementation of the regulation.
Another potential problem is fuel specification itself. Currently our regulation only requires minimum RON 91 and Sulphur content of maximum 50 ppm, until specification limits for aromatics content and distillation are still under discussion. PT. Pertamina (Persero) proposed higher aromatics and distillation parameters than allowed in the Euro 4 fuel specification.
Q: Looking into the future, are there any plans yet to develop Indonesian fuel specifications beyond the Euro 4 standard?
A: Basically, Indonesia’s government has not yet decided a specific timeline to introduce emission standards for vehicles beyond Euro 4. However, according to Pertamina’s RDM (Refinery Development Master Plan), the company will improve their existing refineries and build new ones in order to increase fuel specification grades up to Euro 5 standards by year 2025.
In March 2019 the Australian government released new fuel standards, set for implementation by 01-Oct 2019. At the time the release of the new requirements, after a three-year long review, was widely described as a major disappointment by clean fuels proponents and supporters, as the authorities missed the opportunity to align Australian standards with other developed markets by enhancing standards only cosmetically, not even matching long out-of-date Euro III standards for some parameters in the revised specifications.
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In this issue of our newsletter, ACFA would like to draw our readers’ attention to our European sister company Sustainable Fuels and their 2050 Vision, which outlines the pathway towards sustainable and clean mobility, as Europe strives to have a climate neutral economy by 2050.