Palm Biodiesel Successfully Reduces Fossil Fuel Consumption by 40%

The Palm Oil Plantation Fund Management Agency (BPDP) has reaffirmed that palm-based biodiesel has become the primary engine in reducing Indonesia’s dependency on fossil energy. The contribution of palm oil to the national energy transition is significant; through its use, Indonesia has successfully lowered fossil fuel consumption by 40 percent.

Mohammad Alfansyah, Director of Downstream Fund Distribution at BPDP, explained that this is part of a downstreaming strategy focused on strengthening domestic demand since 2015. This strategy has proven effective in maintaining price stability and providing direct benefits to palm oil farmers.

“By using palm-based biodiesel, we have successfully reduced fossil energy use by up to 40 percent. This means that in every liter of diesel fuel used, 40 percent comes from palm oil,” Alfansyah emphasized. He further noted that this impact is not just about energy, but also about the welfare of farmers and the strengthening of national energy sovereignty.

Holistic Downstreaming Strategy: From Palm to Cocoa

In addition to its focus on palm oil, BPDP is expanding its mandate to develop the coconut and cocoa sectors. The agency aims to optimize the potential of these two commodities by encouraging the growth of community-based small and medium enterprises (SMEs).

This vision includes household-scale industrialization for derivative products such as coconut oil, coconut sugar, and various processed cocoa products. This step is expected to create jobs, increase labor absorption, and empower the local economy more equitably.

Long-Term Commitment: Investing in Human Resources

BPDP is also investing in the next generation of farmers to ensure the future of the plantation sector. Recognizing that most farmers are currently of advanced age, BPDP manages a vocational education program up to the undergraduate level.

This program has reached over 9,000 students and ensures their connection to the professional workforce. Through this holistic approach, BPDP ensures the plantation sector continues to thrive with innovation, managed by a skilled new generation.