Indonesia's New Carbon Market Blueprint: What Presidential Regulation (Perpres) 110/2025 Means for the Future of Low Carbon Investment
For years, Indonesia's carbon market held enormous promise but remained largely frozen in place, not for lack of ambition, but for lack of a functional regulatory engine. That changed on October 10, 2025, when President Prabowo Subianto signed into law Presidential Regulation (Perpres) No. 110 of 2025, a landmark overhaul that repeals and replaces Perpres No. 98 of 2021 and rewrites the rules of engagement for every actor in Indonesia's carbon economy.
The old framework created three critical bottlenecks. International carbon credit transfers were legally ambiguous until Indonesia's NDC targets were fully achieved, effectively freezing voluntary carbon exports for years. The national registry (SRN PPI) was designed for climate reporting, not real time transactional carbon unit management. And unclear boundaries between voluntary and compliance markets left developers and buyers unable to determine which credits could be sold internationally. Perpres 110/2025 resolves all three.
The new framework organizes Indonesia's Carbon Economic Value (NEK) instruments into three pillars. Carbon Trading (Perdagangan Karbon) operates through both an Emissions Trading System for compliance entities and an Emission Offsetting mechanism issuing verified SPE GRK certificates for domestic and international buyers. Results Based Payments (RBP) channel bilateral and multilateral climate finance, from Norway, the Green Climate Fund, and the World Bank, through Indonesia's Environmental Fund Management Agency (BPDLH) without transferring carbon ownership. Carbon Levies and Taxes apply a cap and tax fiscal pressure on entities exceeding their emission allocations.
The most consequential provision is Article 58(1), which explicitly authorizes carbon trading to proceed before Indonesia's NDC targets are achieved, ending the de facto moratorium on international voluntary carbon transactions. This is complemented by Article 68, which establishes a two track cross border system. Track 1 requires government authorization and Corresponding Adjustments for credits traded under Article 6.2 of the Paris Agreement and international compliance markets like CORSIA. Track 2 requires neither authorization nor Corresponding Adjustments for credits purchased by international corporations for voluntary net zero pledges, fully unlocking Indonesia's voluntary carbon market to global corporate buyers.
To support the framework, Perpres 110/2025 mandates two complementary registries. The SRN PPI continues as the overarching public climate registry for NDC tracking. The SRUK, operationalized in July 2026, functions as a dedicated transactional carbon unit registry managing issuance, serial numbering, ownership, transfer, and retirement of all credits, with API interoperability connecting to Verra VCS, Gold Standard, Plan Vivo, and the UNFCCC Article 6.4 registry. The NEK Steering Committee, chaired by the Coordinating Minister for Food Affairs and comprising 17 sectoral ministers, provides executive level governance over the entire system.
For project developers, the Project Design Document (Dokumen Rancangan Aksi Mitigasi / DRUM) to SRUK pipeline is now fully codified. For corporate buyers, Indonesian credits are accessible for voluntary net zero commitments under Track 2 without intergovernmental complexity. For compliance entities, the ETS and offset mechanisms offer market based flexibility. Indonesia's carbon market has moved from potential to platform. The question now is how fast and equitably it will grow.
Learn how your organization can assess its carbon position in Indonesia's evolving NEK landscape. Connect with a certified carbon project facilitator or request a pre-feasibility assessment for your mitigation project today.