"I think the economic potential (from carbon trading) is big," he said here on Thursday.
He added that carbon trading can be implemented in Indonesia immediately as it does not require infrastructure development such as building factories or construction.
Regarding the implementation of carbon trading, he proposed that the carbon tax be set properly and not casually.
"It must promote a value, which will be considered by business actors to prefer buying carbon credits to paying the carbon tax," Soeparno expounded.
He then advised the government to not delay the implementation of the carbon tax for too long.
Indonesia officially joined the global network of carbon trade by unveiling its first international carbon trade transactions at the Indonesian Stock Exchange (BEI) in Jakarta on Monday.
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Environment Minister Hanif Faisol Nurofiq said that the initiative aims to achieve Indonesia's climate targets, as outlined in the Nationally Determined Contributions (NDC) document.
He explained that international carbon trading will be carried out by ensuring the optimization of the National Registry System (SRN) as well as preparing infrastructure and other related instruments.
Carbon trading will involve several potential strategic energy projects, such as the operation of the Gunung Wugul Mini-Hydro Power Plant in Central Java, which is projected to reduce five thousand tons of carbon dioxide equivalent (CO2 eq).
It will also involve operating the Priok Block 4 Gas and Steam Power Plant (PLTGU), constructing the PLTGU Block 3 PJB Muara Karang in North Jakarta, as well as converting single-cycle power plants to combined cycles at the Grati Block 2 PLTGU in East Java.
According to the minister, these large projects are expected to slash emissions by up to 750 thousand tons of CO2 eq, and thereby make a significant contribution to efforts to decarbonize the energy sector.
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Translator: Sinta Ambarwati, Yashinta Difa
Editor: Rahmad Nasution
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