by Setyawati Fitrianggraeni and Tiara Amanda Putri
Overview
The Government has officially enacted Presidential Regulation No. 110 of 2025 on the Implementation of Carbon Economic Value Instruments and National Greenhouse Gas Emission Control.(1) marking a significant regulatory milestone in reinforcing Indonesia’s legal certainty and institutional credibility in responding to climate change challenges that threaten long-term economic sustainability.(2) The Regulation further underscores that climate change mitigation measures must be implemented in alignment with national economic development, based on the principles of sustainable and environmentally sound development.(1)
The implementation of Presidential Regulation 110/2025 prioritizes cross-sectoral synergy by internalizing climate-related impacts into business activities through Carbon Economic Value or Nilai Ekonomi Karbon (NEK) instruments.(3) The Regulation mandates that all greenhouse gas emission reduction actions be subject to an integrated Measurement, Reporting, and Verification (MRV) process to ensure data accuracy and prevent double-counting. It also establishes a Steering Committee, led by the relevant Coordinating Ministry, to oversee coordination, supervision, and evaluation of the implementation of NEK instruments, thereby ensuring the effective and accountable achievement of national emission reduction targets.(1)
Key Highlights
- Carbon Economic Value (NEK) Instruments
NEK instruments comprise carbon trading mechanisms (emissions trading and offsets), result-based payments, and carbon levies in the form of a carbon tax. Implementation involves relevant ministers as sectoral coordinators, business entities as emission-managing actors, and the public as active participants in mitigation efforts.(1) Implementation is carried out by setting emission caps for regulated installations and facilitating carbon unit transactions through the carbon exchange(1) or through direct trading mechanisms to promote cost-efficient emission reductions.(4)
- International Market Connectivity and Carbon Registry System (SRUK)
The Carbon Registry System or Sistem Registri Unit Karbon (SRUK) serves as the national central database, recording all carbon units in a transparent and real-time manner to ensure market integrity.(2) The Minister of Environment holds full authority to approve international carbon trading activities, ensuring alignment with Article 6 of the Paris Agreement.(1) The system further utilizes decentralized network technology to safeguard against double-counting and to ensure that Indonesian carbon credits meet internationally recognized high-quality standards.(2)
- Transparency Framework through the MRV Mechanism
MRV mechanism constitutes a mandatory standard for accurately measuring, reporting, and verifying greenhouse gas emissions of carbon removals.(1) Business entities and regional governments are required to submit periodic emission reports, which are subject to validation by accredited independent verification bodies.(2) The process is integrated with the National Registry System for Climate Change Control (SRN PPI) to provide the scientific basis for the issuance of Emission Reduction Certificates or Sertifikat Pengurangan Emisi (SPE).(1)
- Strengthening Governance through a Steering Committee
A Steering Committee is established to provide policy direction, coordinate across ministries, and oversee the implementation of NEK instruments and national greenhouse gas (GHG) emission control. Chaired by the coordinating minister for Food Affairs, with the Coordinating Ministers for Economic Affairs and Infrastructure as Vice Chairs, the Committee comprises relevant technical ministers, including the Minister of Environment and the Minister of Finance. It harmonizes cross-sector carbon trading procedures and reports annually to the President to ensure the effective achievement of low-carbon development targets.(1)
References
1. Peraturan Presiden Nomor 110 Tahun 2025 tentang Penyelenggaraan Instrumen Nilai Ekonomi Karbon dan Pengendalian Emisi Gas Rumah Kaca Nasional.
2. Khalqi M. Tantangan Indonesia dalam Penerapan Pasar dan Pajak Karbon. 2026.
Available from: https://www.pajak.com/komunitas/opini-pajak/tantangan-indonesia-dalam-penerapan-pasar-dan-pajak-karbon/
3. Alfred J. Internalisasi Dampak Iklim dan Nilai Ekonomi Karbon Jadi Kunci Pertumbuhan Bisnis Berkelanjutan. 2026. Available from: https://ecobiz.asia/internalisasi-dampak-iklim-dan-nilai-ekonomi-karbon-jadi-kunci-pertumbuhan-bisnis-berkelanjutan/
4. Rahayu AMK, Jumiati A, Ferera Z. Penyuluhan Hukum Perdagangan Karbon sebagai Upaya Pengendalian Emisi dalam Mewujudkan Sustainable Development City di Desa Palur Wetan, Kecamatan Mojolaban, Kabupaten Sukoharjo. Jurnal Pengabdian Masyarakat Bangsa. 2026 Jan 15;3(11):6501–8. doi:10.59837/jpmba.v3i11.3840
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