Indonesia is set to explore potential partnerships for a carbon trading scheme, as outlined in Article 6 of the Paris Agreement, according to Minister of Environment, Hanif Faisol Nurofiq. Following a preparatory meeting for the 29th UN Climate Change Conference (COP29) in Jakarta, Hanif emphasized that Indonesia's delegation will focus on achieving its greenhouse gas (GHG) emission reduction targets and implementing Article 6, which governs international climate financing models, including carbon trading frameworks. Notably, Indonesia plans to collaborate with Japan under Article 6.2, which facilitates international carbon trading between countries. Hanif stated that Indonesia’s Nationally Determined Contribution (NDC) from 2021 will serve as the foundation for this partnership.
Further details regarding the collaboration were withheld by the Head of the Environmental Control Agency, who indicated that they will be announced by the Special Envoy for Energy and Environment, Hashim Djojohadikusumo. Hashim highlighted Indonesia's significant potential in carbon trading, citing the country’s reduction of 577 million tons of CO2 equivalent (CO2e) between 2018 and 2020, with an additional 600 million tons of CO2e expected for the 2021-2023 period. He noted that this reduction could generate substantial revenue, estimating that Indonesia could earn around USD 10 per ton, amounting to approximately IDR 190 trillion in additional state revenue beyond the national budget.
