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Experts remain doubtful about Indonesia’s planned carbon-capture regulation
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Repsol's KBD-2X well in the Kaliberau field, Sakakemang block, South Sumatra is pictured in this handout photo. The block is jointly operated by Repsol, Malaysia's Petronas and Japan's Mitsui Oil Exploration. (Courtesy of SKK Migas/-)
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he government is preparing a regulation draft on carbon capture storage (CCS) and carbon capture utilization and storage (CCUS) as the country seeks to push its adoption to reduce carbon emissions from hard-to-abate industries, but whether this will be effective depends largely on a working financing mechanism.
Alloysius Joko Purwanto, an energy economist at the Economic Research Institute for ASEAN and East Asia (ERIA), said that the success of CCS/CCUS would need careful examination of the costs and benefits of other countries’ experiences in providing tax credits for technology development.
Furthermore, he suggested the government consider including carbon-tax schemes to ensure successful commercialization of CCS/CCUS projects.
“Moreover, would the entire problem surrounding CCS/CCUS implementation be solved just with a ministerial regulation? [It is important] to note that application of the technology involves other aspects [dealt with by] separate ministries,” Joko told The Jakarta Post on Thursday.
Read also: Indonesia delays carbon tax implementation again, 1 week before enactment
CCS/CCUS development is one of Indonesia's strategies for reaching net-zero emissions by 2060. The carbon-capture projects have been gaining momentum worldwide.
However, while the International Energy Agency (IEA) says the technology is critical to hitting global net-zero goals, it has been plagued by a high failure rate due to high capital costs, unclear revenue streams and limited technological readiness that risks leakage, as well as other issues.
