Indonesia urged to speed up emissions checks to limit EU carbon costs
A single-case simulation found verified industrial emissions data could cut CBAM compliance costs by approximately 90 per cent compared with EU default values.
Indonesia should accelerate verification of industrial emissions, prioritising iron and steel, to protect exporters from higher European Union carbon costs, National Economic Council (DEN) member Mochamad Firman Hidayat said at a Jakarta discussion.
Firman said a DEN simulation found that using specific Ministry of Industry data rather than EU default values could lower compliance costs under the Carbon Border Adjustment Mechanism (CBAM) by approximately 90 per cent. He cautioned that the result concerned one case and was not a reduction all exporters could expect.
DEN simulations indicate that default emissions calculations could push carbon costs above selling prices for some products. Hot-rolled coils and carbon steel wire rods were identified as potentially losing access to the European market.
DEN's mapping of 2025 data put Indonesian exports in CBAM-covered categories to the EU at approximately US$2.32 billion, or about 11.9 per cent of exports to the bloc. Global exports in those categories totalled roughly US$33.3 billion.
At the discussion hosted by the Center for Indonesian Policy Studies (CIPS), researcher Andree Surianta called for an internationally recognised measurement framework. He urged alignment between the Industry Ministry's emissions measurement work and the Environment Ministry's oversight of carbon trading.
The Industry Ministry is developing decarbonisation roadmaps for nine industrial subsectors, including metals, cement, chemicals and fertilisers.
Under the EU timetable, purchases of CBAM certificates covering 2026 imports begin in February 2027. Importers must submit their first annual declarations and surrender certificates by September 30, 2027.
