The Ministry of State-Owned Enterprises (BUMN) confirmed that one of the state-owned companies will enter carbon trading in September 2023. Deputy Minister of BUMN 1, Pahala Nugraha Mansury, did not deny that there is a complicated process to create a carbon trading market, starting from the baseline of emission production, the cause of the reduction emissions, validation and verification, to carbon credits registered with the National Registry.

"Our target is that before September there will be one of our BUMNs carrying out carbon trading facilitated by the IDX with regulatory guidance from the Ministry of Environment and Forestry and also by the OJK," Pahala told reporters, Monday (3/7/2023).

He explained that his party had given directions to 8 BUMNs which are the largest emitters to prepare an emissions reduction roadmap in accordance with the Nationally Determined Contribution (NDC).

Apart from the 8 BUMNs, Pahala hopes that Perhutani (State Forestry Public Company) and PT Bureau Klasifikasi Indonesia (Persero) or BKI can act as liaison between BUMNs and the carbon market which can help verify and validate the carbon produced by the companies.

"Each sector has an NDC, what kind of oil and gas, one of the clearest NDC targets is in the electricity sector, especially in the power generation sector, which already has a target for the amount of emissions that must be reduced by 2030," he said.

In addition, he explained that the carbon market has a new accounting formula that is more complicated than calculating other commodities. While in trading generally there are clear measurements and proof of transactions, whereas in carbon accounting it is quite difficult to prove it. For this reason, based on Erick Thohir's direction in a circular regarding directions to BUMN to reduce carbon emissions in accordance with the carbon calculation system that has been implemented globally.

"Carbon trading has a target, if you are below the target it means you don't need to pay tax, but if it is above, first you can buy carbon first, if you have bought it and haven't reached it then there is a carbon tax [tax], but this is a complicated calculation ," he explained. Furthermore, Pahala explained the government's desire to trade carbon emissions through an organized market, in this case the government appointed the Financial Services Authority (OJK) as the regulator so that the Indonesian carbon market could be traded internationally.

"So the link between the National Carbon Registry and an organized carbon market is very important, because only people who have registered with the National Carbon Registry can trade on the carbon market," he said. In this case, Pahala, who also serves as President of CFA Society Indonesia, a non-profit association for investment professionals, will hold a conference entitled "Indonesia's Transition towards Net Zero" which will be held on July 6 2023. This agenda is carried out to explore various opportunities and potential for Indonesia in carry out the transition towards net zero emissions (NZE) through State-Owned Enterprises (BUMN) and the private sector.

As is known, Indonesia is currently in a transition period towards a Green House Gas (GHG) emission reduction target of 29 percent without conditions and 41 percent with conditions. With a maximum target of achieving zero carbon emissions by 2060. Pahala explained, there are 3 topics that will be discussed at the conference which include, the role of the public/private sector in achieving NZE, the future of Indonesia's carbon exchange, and the role of investors in the net zero transition. Meanwhile, the conference will invite various stakeholders ranging from PLN, PT Pertamina Power Indonesia, Xurya Daya Indonesia, PwC Legal Indonesia, the Coordinating Ministry for Maritime Affairs and Fisheries for Carbon Trading, PT BNP Paribas Asset Management, PT Mandiri Manajemen Investasi, and others.