Indonesia’s New Agricultural Carbon Offset Regulation: Key Takeaways
Indonesia’s New Agricultural Carbon Offset Regulation: Key Takeaways
Indonesia has issued Permentan No. 18 of 2026, establishing the legal framework for carbon trading through GHG emission offsets in agriculture. Here’s what matters:
Who Can Participate?
· Business entities (with NIB and relevant KBLI)
· Government (via Public Service Agencies)
· Farmer Institutions (cooperatives or legal entities)
Business entities must partner with at least 3 local farmer institutions through profit-sharing agreements based on free, prior, and informed consent.
Three sub-sectors: Rice Paddies, Livestock, and Plantations. Mitigation actions include low-emission practices (water management, balanced fertilization) and carbon sequestration (agroforestry, biochar, soil carbon).
Certification Pathway (SPE GRK)
1. Submit DRAM via SRUK
2. Technical review by Ministry team
3. Independent validation & verification
4. Ministry recommendation issued
Multi-sector offsets (agroforestry, biogas) are recognized. Units can be authorized for international NDC fulfillment under Article 6 of the Paris Agreement.
Existing projects and carbon units (from 2021 onward) must be reported within 6 months of the regulation’s effective date.
The regulation balances economic incentives with social safeguards—requiring farmer partnerships to avoid “carbon colonialism.” Success depends on forthcoming technical guidelines, particularly on profit-sharing standards and MRV accreditation.
For agribusinesses, now is the time to assess land assets and supply chains for offset potential.
