Jakarta. Indonesia is currently running road tests on B50, the biodiesel containing a 50 percent palm oil blend, as the country wishes to stop buying foreign diesel starting next year.

The resource-rich Indonesia has required the use of biodiesel made from palm oil and conventional diesel fuel. The current mandatory palm oil blend stands at 40 percent in a policy better known as the B40. The number corresponds to the palm oil content in the biodiesel. Indonesia is forging ahead with its plan to launch the B50 as it wishes to take advantage of its abundant palm oil supplies to cut down on imports. 

According to Energy Minister Bahlil Lahadalia, the road tests, which aim to evaluate the B50’s performance on vehicles, are underway. Indonesia aims to implement the B50 mandate in the second semester of 2026, and seeks to finish the road tests by that time. The last round of road tests can take between 6 and 8 months. If everything goes well, Indonesia can end diesel imports next year.

“So we test the B50 [biodiesel] on ships, trains, and heavy equipment. If everything is clear and we finally decide to use B50 [based on those tests], if God is willing, we can stop importing diesel. … Our calculations show that the [B50 and end to import] are possible in the second semester of 2026,” Bahlil said on the sidelines of the 2025 Investor Daily Summit in Jakarta.

To meet the greater palm oil demand following the B50 mandate, the government is looking for ways to boost crop yield in its existing land. “It is likely that we will have to expand the crop’s planting areas or if we have to, we might reduce our [palm oil exports],” Bahlil told the press.

"But if the yield intensification and expansion are enough [to produce the needed palm oil], we don’t have to cut down on exports.” 

Indonesia managed to save at least $40.71 billion in foreign exchange from using palm oil-based biodiesel between 2020 and 2025, Bahlil claimed. The palm oil mandate gradually rose from B30 to B40 over the years. The government’s estimates showed that foreign exchange savings could reach $10.84 billion in 2026 alone if the B50 policy could be in place that year.

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