On October 10, 2025, President Prabowo Subianto signed Presidential Regulation (Peraturan Presiden) No. 110 of 2025, titled “Implementation of Carbon Economic Value Instruments and National Greenhouse Gas Emission Control.” This new regulation immediately replaces Presidential Regulation No. 98 of 2021, effectively lifting the moratorium on international voluntary carbon credit trading.
Context: The Perpres reopens Indonesia’s carbon market to foreign buyers after a four-year hiatus. It officially revokes the 2021 decree that had halted cross-border carbon sales, once again authorizing the international trade of carbon credits from Indonesian projects. The rule was made public in mid-October 2025, signaling Indonesia’s return to the global voluntary carbon market.
- Resumption of International Trading: Perpres 110/2025 allows carbon credits from Indonesian projects to be sold to international buyers again, under stricter standards. Credits can be traded in accordance with Indonesian national protocols or accepted international frameworks (e.g. UNFCCC standards), ensuring transparency and integrity. A decentralized National Carbon Unit Registry (SRUK) is being established to record all carbon units in real time and prevent double counting of emission reductions.
- Recognition of Voluntary Standards: Indonesia will formally recognize and cooperate with major voluntary carbon market (VCM) standards. The government signed multiple Mutual Recognition Agreements (MRAs) in 2025 with certifiers like Verra, Gold Standard, Plan Vivo, and the Global Carbon Council. Under the new regulation, carbon projects certified by these international standards are permitted and encouraged, provided they also register on Indonesia’s system. This integration gives legal footing to voluntary projects and opens immediate opportunities for carbon developers and investors under globally recognized methodologies.
- Decoupling from NDC Targets: A crucial shift is that carbon trading is no longer contingent on Indonesia achieving its Nationally Determined Contribution (NDC) targets first. Previously, carbon credit exports were essentially on hold until domestic climate goals were secured. Now, PR 110/2025 explicitly decouples voluntary carbon trading from the NDC timeline, allowing projects to generate and sell credits without waiting for national target fulfillment. This reduces regulatory risk and enables earlier investment in emission-reduction projects.
- Article 6 Clarity: The regulation provides clear rules on international credit transfers under the Paris Agreement’s Article 6. It distinguishes between credits that will apply a Corresponding Adjustment (CA) (for offsets counting toward another country’s NDC) and those that will not (pure voluntary offsets). This clarity is vital to uphold environmental integrity – ensuring that any credit exported for another country’s compliance is subtracted from Indonesia’s emission inventory to avoid double-claiming. At the same time, non-CA credits can flow in the voluntary market without affecting Indonesia’s NDC, giving flexibility to private-sector transactions.
- Strengthened Governance: Perpres 110/2025 elevates the institutional framework for carbon pricing. It establishes a high-level Steering Committee on Carbon Pricing and GHG Emission Control, now chaired at the Coordinating Minister level for better cross-sector coordination. This suggests a stronger political mandate – aligning ministries such as Environment and Forestry, Energy, Finance, and others under a coordinated strategy. The dedicated national carbon exchange (IDXCarbon, launched in 2023) and monitoring, reporting, and verification (MRV) systems will also be integrated into this governance structure to boost market credibility.
15 Oct 2025 – Sources: Dana Mitra Lingkungan; Reforestaction; Reuters
