Jakarta. Indonesia plans to introduce a mandatory 10% ethanol blend in gasoline (E10) next year before raising the blend to 20% (E20) in 2028, as the government seeks to reduce fuel imports and build a domestic bioethanol industry.

Energy and Mineral Resources Minister Bahlil Lahadalia said on Monday that a government study on the ethanol mandate, launched in 2025, is nearing completion and will serve as the basis for a roadmap to gradually implement the E20 program.

“The proposal for the ethanol mandate has been under study since 2025, and the assessment is now almost complete. We plan to implement E20 in 2028–2029,” Bahlil told reporters at the Presidential Palace in Jakarta.

The government plans to begin with a mandatory 10% ethanol blend before gradually increasing the proportion to 20%, following the same phased approach used in Indonesia's biodiesel program, which has expanded from B10 to B20, B30 and now B50.

Bahlil said the policy is intended to reduce Indonesia's dependence on imported gasoline while ensuring that ethanol supplies are sourced domestically rather than through imports.

“We do not want to implement E20 only to end up importing ethanol. That is why we are first preparing the industry,” he said.

Indonesia plans to produce bioethanol from locally available feedstocks, including cassava, sugarcane, corn and other crops capable of producing ethanol.

The government will prioritize the development of domestic bioethanol production and its supporting supply chain over the next one to two years to ensure sufficient feedstock before the mandate takes effect.

In parallel, authorities are developing integrated sugarcane plantations and downstream processing facilities to secure long-term supplies of bioethanol.

Bahlil said Indonesia is also studying Brazil's bioethanol industry, where producers can switch between sugar and ethanol production depending on market prices, a model the government hopes to replicate as it develops the country's domestic biofuel sector.