Indonesia is advancing its carbon trading framework to strengthen its climate action efforts. As a carbon project developer, CarbonEthics was invited to attend Hearing Meeting (RDP) and Public Hearing Meeting (RDPU) of Commission XII of DPR RI , to discuss the acceleration of carbon trading implementation. During the session, CarbonEthics provided insights and recommendations to enhance governance, improve regulations, and optimize the Voluntary Carbon Market (VCM) as part of Indonesia’s climate commitments.
CarbonEthics’ Key Recommendations for Accelerating the Implementation Indonesia’s Carbon Market
To build a well-functioning and competitive carbon market, CarbonEthics highlights four key recommendations that can enhance Indonesia’s climate strategy and accelerate its Nationally Determined Contributions (NDC):
Unlocking the Role of VCM in Achieving Indonesia’s NDC – The Voluntary Carbon Market (VCM) has the potential to contribute significantly to Indonesia’s climate goals by utilizing carbon credits from VCM for Indonesia’s NDC achievement. Other countries, such as Chile, Colombia, South Africa, Malaysia, and Singapore have already adopted voluntary market units to support their climate target’s achievements.
Recognizing International Standards Through a Mutual Recognition Agreement (MRA) – In efforts to meet the existing demand of high-integrity and high-quality carbon credits coming from foreign buyers, Indonesia needs to recognize international standards through MRA. Establishing an MRA with renowned international standards will help enhance credibility, improve market access, and facilitate international carbon trading. By adopting global best practices, Indonesia can strengthen confidence in its carbon market, making it more attractive for both domestic and international stakeholders looking to contribute to climate solutions.
Coexistence of Government Jurisdictional Programs and Private-Sector Projects – To maximize impact, government-led jurisdictional programs and private-sector carbon projects should be able to operate side by side, creating a more inclusive and integrated carbon market. Clear policies and coordination mechanisms can help prevent overlaps, foster collaboration, and ensure that both regulatory frameworks and market-driven initiatives contribute effectively to emissions reduction.
Strengthening Governance and Coordination of Carbon Trading Through the Establishment of a Dedicated Task Force – A well-regulated and transparent carbon market requires strong governance. Currently, the carbon market implementation involves various sectors and ministries, necessitating a more integrated and efficient approach to ensure effective implementation. Establishing a task force as the central coordinating body across ministries and agencies would be a strategic step to promote a unified, synchronized, and impactful implementation of the carbon market across all sectors.
Strengthening Regulations to Accelerate Carbon Trading Implementation
The results of the meeting concluded that Commission XII of the Indonesian House of Representatives (DPR RI) has acknowledged and understood various inputs regarding the acceleration of carbon trading in Indonesia. Commission XII of the Indonesian House of Representatives (DPR RI) will encourage relevant Ministries or Agencies responsible for carbon trading regulations to evaluate existing regulations and/or draft new regulations that can accelerate carbon trading in Indonesia within a measurable time frame.
Working Together for a Sustainable Carbon Market
CarbonEthics continues to support Indonesia’s transition to a low-carbon economy through nature-based solutions and sustainable carbon projects. Stronger policies and collaboration among various stakeholders are essential to ensuring an effective carbon market that makes a real impact on national and global climate goals.
Comentarios