The government has emphasized that the country’s economic growth target of 8 percent must align with environment responsibility, focusing on Carbon Capture and Storage (CCS) technology as solution to reducing carbon emissions.

“Innovative technologies like CCS are a strategic solution to reducing carbon emissions without hindering industrial development. With vast geological storage capacity, Indonesia has significant potential to become a CCS hub in Asia,” Deputy for Energy and Mineral Resources Coordination at the Coordinating Ministry for the Economy, Elen Setiadi, said while addressing a workshop titled "Opportunities and challenges in implementing CCS activities in Indonesia" in Jakarta on Thursday, February 28, 2025.

Indonesia has demonstrated strong economic resilience amid global uncertainties, recording a 5.02 percent year-on-year economic growth in Q4 2024. The implementation of CCS is expected to contribute to industrial decarbonization, attract new investments, create jobs, and enhance national industrial competitiveness.

The workshop covered key aspects of CCS implementation in Indonesia, including cross-border CCS operations with Singapore, regulatory frameworks, and policy support. Discussions also included Singapore’s carbon tax scheme and technical aspects of CCS, such as measurement mechanisms, transfer points, and risk management. The government highlighted various funding models and support mechanisms to accelerate CCS projects.

Environmental considerations and carbon storage regulations were also in focus, including carbon accounting mechanisms and emissions tracking to ensure the program's sustainability. Cost structures and CCS business models were analyzed to secure long-term investments, while potential collaborations between Indonesia and Singapore were explored. Additionally, updates on State energy company PT Pertamina’s involvement in CCS projects were discussed.

The workshop was attended by representatives from relevant ministries, energy companies such as Pertamina and ExxonMobil, and international stakeholders, including delegates from Singapore’s Ministry of Trade and Industry. Collaboration between the public and private sectors is deemed essential for developing a globally competitive CCS ecosystem.

“Indonesia can become a prime destination for CCS investment with integrated infrastructure and supportive regulations. Synergy among stakeholders is crucial to ensuring that CCS contributes optimally to the energy transition and national economic growth,” Elen said.

Ary Sudijanto, Deputy for Climate Change Mitigation and Carbon Economic Value Governance at the Ministry of Environment and Forestry, said that CCS enhances economic value by leveraging Indonesia’s geological resources to attract both domestic and foreign investments. He also announced that the ministry would coordinate with the Ministry of Energy and Mineral Resources to develop a roadmap for cross-border CCS implementation.

Tubagus Negara, Executive Director for Policy Synchronization at the National Economic Council, highlighted three key priorities for advancing CCS technology, namely developing domestic and international markets to ensure economic feasibility, expediting regulatory discussions, and designating a CCS Champion within government institutions to enhance global competitiveness.