Do Not Be Confused There Are Solar Mixing Palm Oil, This Is Understanding and Its Price

From now on say sayonara on pure Solar or B-0 type fuels. Just look at it, all Public Fuel Filling Stations (SPBU) will only sell Solar with a mixture of palm oil at 20% (Biodiesel 20 / Solar B20). This obligation has been valid since September 1, 2018.Biodiesel is a biofuel (BBN) for diesel engines or motors in the form of fatty acid methyl esters (vegetable oil or fatty acid methyl ester / FAME) made from vegetable oil or animal fat through the process of esterification or transesterification. The biodiesel raw material currently comes from palm oil (CPO).

The benefits of biodiesel are used as alternative energy to replace diesel or diesel fuel types. In other words, this palm oil can be used 100% for all diesel vehicles or mixed with Solar at a certain level, like 20%. So the B20 program combines 80% Solar and 20% palm oil.

This government program runs on 4 legal grounds:

1. Presidential Regulation (Perpres) Number 66 of 2018 concerning Second Amendment to Presidential Regulation Number 61 of 2015 concerning Collection and Use of Palm Oil Plantation Funds

2. Regulation of the Minister of Energy and Mineral Resources No. 41 of 2018 concerning the Provision and Utilization of Biodiesel Type of Biodiesel in the Framework of Financing by the Palm Oil Plantation Fund Management Agency (BPDP)

3. Ministerial Decree (Kepmen) of ESDM Number 1935 K / 10 / MEM / 2018 concerning Amendment to Minister of Energy and Mineral Resources Decree Number 1803 K / 10 / MEM / 2018 concerning Establishment of Biodiesel Type Biofuel Business Entity and Allocation of Volume Amount for Biodiesel Type Biofuel Procurement at PT Pertamina (Persero) and PT AKR Corporindo Tbk for the period May-October 2018

4. ESDM Ministerial Decree Number 1936 K / 10 / MEM / 2018 concerning Biodiesel Type Biofuel Procurement for General Fuel Type Mixing for the period September-December 2018.

In accordance with the direction of President Joko Widodo (Jokowi), B20 in Solar expanded massively to various subsidized and non-subsidized sectors, including all diesel-engined vehicles in Indonesia or private vehicles.

So it’s not just trains that consume diesel fuel mixed with palm oil, but also non-subsidized vehicles, including heavy equipment in the mining sector, tractors or excavators, to industrial sectors, such as micro, fisheries, agriculture, industry and commercial.

The use of 20% palm oil mixed palm oil is one of the government’s efforts to lift the rupiah from adversity. As is known, the Garuda currency collapsed to the lowest level since the monetary crisis in 1998.

With the implementation of the Solar B20 program, Indonesia could save foreign exchange of USD 2.3 billion or IDR 34.04 trillion (exchange rate of IDR 14,800 per US dollar), and reduce fuel imports and US dollar needs. If fuel imports shrink, Indonesia’s balance of payments will be healthier, erasing the trade balance deficit, and narrowing Indonesia’s current account deficit.

Other advantages of implementing the B20 program include:

1. Increasing national energy security through energy diversification by prioritizing local energy potential

2. Increasing economic value added through downstreaming of the palm oil industry

3. Open employment, and reduce greenhouse gas emissions and improve environmental quality.

Because of the many benefits, it turns out that not only Indonesia has implemented B20, but also other countries, namely Costa Rica, Central America (raw materials of jathropha, 2016), and Minnesota a state in the United States (raw material for soybean oil, starting May 1, 2018 )

Duh, if Solar is mixed with palm oil, the price will be more expensive? Take it easy, not at all. The government guarantees the selling price of B20 Solar at both subsidized and non-subsidized gas stations will not rise. This means that the selling price is fixed, including:

Solar subsidies are priced at IDR 5,150 per liter. The price has been subsidized by the government of Rp.2,000 per liter
While for non-subsidies, such as Pertamina Dex is sold at Rp. 10,500 per liter
That’s at Pertamina’s gas station. If at Shell and other gas stations, the price of B20 depends on each policy.
“The price (B20) is the same as BBM (Solar) at the gas station, does not change. If the CPO price goes up, (the price) remains because (the difference in price) is borne by him (BPDP), but if the rising Solar price means more government subsidies, “said Coordinating Minister for Economic Affairs, Darmin Nasution, recently.

The price was agreed by the President Director of PT Pertamina (Persero), Nicke Widyawati. Then what steps will be taken by the State-Owned Enterprises (SOEs) in the oil and gas sector based on B20 rules?