Indonesia needs to construct 320 dedicated production facilities to support a proposed nationwide mandate that would blend ordinary gasoline with 50 percent ethanol, according to details shared by senior officials in Jakarta.
The ambitious proposal for the so-called E50 program marks a dramatic scaling up of the nation’s bioenergy strategy. Higher Education, Science and Technology Minister Brian Yuliarto outlined the infrastructure requirements on Monday at the Danantara Technology & Innovation Investment Forum in Jakarta. The announcement follows statements made on October 21 by President Prabowo Subianto, who detailed a phased timeline for ethanol expansion during a cabinet meeting at the Presidential Palace Complex.
Under the government’s projected framework, each of the 320 proposed plants would require an annual output capacity of 60,000 kiloliters. Combined, these facilities would generate 19.2 million kiloliters of ethanol per year, fundamentally transforming the country’s agricultural processing and energy sectors.
The Phased Timeline From E10 to E50
While the long-term target envisions a shift to E50, the government is approaching the transition through incremental steps. State-owned energy company Pertamina has already laid initial groundwork by marketing Pertamax Green 95, an ethanol-blended gasoline product introduced in June 2023.
President Prabowo outlined the subsequent rollout during his October 21 remarks, noting that the country aims to implement an E10 program this year. That initial phase will be followed by a move to E20 within two years, culminating in the E50 target two years after that. “Maybe this year we can only reach E10, maybe two years later we hope for E20 and two years after that we hope to reach E50,” Prabowo said.
Despite the clarity of the timeline, a production deficit looms over the immediate horizon. Indonesia currently operates five major bioethanol production facilities located across East Java, Lampung, Central Java, and Yogyakarta. Their combined effective capacity sits at approximately 70,500 kiloliters per year.
That existing output falls well short of the estimated 500,000 kiloliters of ethanol required to supply the upcoming E10 program slated for 2027. Scaling from 70,500 kiloliters to millions of kiloliters demands a capital injection and a rapid expansion of agricultural feedstocks.
Shifting Energy Spending Toward Domestic Industry
Proponents of the mandate argue that replacing fossil fuels with homegrown renewables will insulate the national economy from volatile international markets. Indonesia currently allocates between $30 billion and $50 billion annually toward energy imports, a capital outflow that officials hope to redirect toward domestic manufacturing and agriculture.
“The world oil price is rising and will rise. "We are grateful that we have many other energy sources," Prabowo said, emphasizing the nation's capacity to use coal, geothermal energy, and plant-based feedstocks.”
The new ethanol push mirrors the structural approach of the country’s existing biodiesel initiatives. Earlier this year, the government launched the B50 program, which mandates a blend of 50 percent palm oil-derived biodiesel and 50 percent conventional diesel. Having achieved that milestone for diesel, the administration views ethanol as the frontier for gasoline.
“At the time of E50 and B50, we will not need to import fuel from outside anymore,” Prabowo stated.
Meeting these industrial goals will require extensive cross-sector collaboration. Minister Brian emphasized that universities and private enterprises must join forces with the government to build out the necessary supply chains. Higher education institutions are expected to contribute by spearheading research, driving technological innovation, and training a specialized workforce to operate the new processing plants.
At the same time, the administration continues to weigh food security against its renewable energy targets. While current domestic ethanol production relies primarily on sugarcane and cassava, the government is exploring alternative, more affordable feedstocks to prevent agricultural competition between fuel production and food supplies as the program expands.
