What Carbon Pricing Framework Exists Under PERPRES 98/2021?

Introduction: Indonesia's Carbon Economic Value Framework

On October 29, 2021, Indonesia implemented a comprehensive regulatory framework that establishes carbon economic value as a national climate policy instrument. Peraturan Presiden Nomor 98 Tahun 2021 tentang Penyelenggaraan Nilai Ekonomi Karbon untuk Pencapaian Target Kontribusi yang Ditetapkan Secara Nasional dan Pengendalian Emisi Gas Rumah Kaca dalam Pembangunan Nasional (Presidential Regulation No. 98 of 2021 on Implementation of Carbon Economic Value for Achieving Nationally Determined Contribution Targets and Greenhouse Gas Emission Control in National Development) creates Indonesia's legal foundation for carbon pricing, carbon trading, and market-based climate change mitigation. This regulation operationalizes Indonesia's commitments under the Paris Agreement by establishing systematic mechanisms for assigning economic value to carbon emissions and creating financial incentives for emission reductions.

The regulation's fundamental innovation is the introduction of Nilai Ekonomi Karbon (NEK) or Carbon Economic Value as a national policy framework. Article 1(3) defines NEK as "nilai terhadap setiap unit emisi gas rumah kaca yang dihasilkan dari kegiatan manusia dan kegiatan ekonomi" (value for every unit of greenhouse gas emissions generated from human activities and economic activities). This definition establishes that carbon emissions carry quantifiable economic value, transforming emissions from unregulated externalities into measurable economic units subject to market mechanisms, government pricing, and performance-based payment systems. By assigning economic value to carbon, the regulation creates financial incentives that make emission reductions economically rational for businesses and enable market-based climate policy implementation.

PERPRES 98/2021 establishes four primary NEK implementation mechanisms outlined in Article 47: carbon trading (perdagangan karbon), performance-based payments (pembayaran berbasis kinerja), carbon levies (pungutan atas karbon), and other NEK mechanisms determined by ministerial regulation. These four instruments provide Indonesia with flexible policy tools matching different sectoral contexts and emission sources. Carbon trading enables market-based emission reductions where businesses buy and sell carbon units, creating price discovery through supply and demand. Performance-based payments reward verified emission reductions with government or international climate finance. Carbon levies impose direct costs on carbon emissions through taxation or pricing mechanisms. The regulation's multi-instrument approach recognizes that no single mechanism suits all emission sources, requiring diverse policy tools for comprehensive emission control.

The regulation establishes the Komite Pengarah Nilai Ekonomi Karbon (NEK Steering Committee) as the national coordination body responsible for strategic policy direction, cross-sectoral coordination, and NDC achievement monitoring. Article 59 grants this committee authority to establish NEK implementation policies, coordinate sector-specific carbon management strategies, and monitor Indonesia's progress toward its Nationally Determined Contribution (NDC) targets under the Paris Agreement. The committee structure ensures high-level government coordination across ministries, preventing siloed climate policies that could undermine overall NDC achievement. The regulation connects NEK implementation directly to Indonesia's international climate commitments, creating domestic legal obligations to achieve emission reduction targets specified in NDC documents submitted to the United Nations Framework Convention on Climate Change (UNFCCC).

This comprehensive analysis examines PERPRES 98/2021's carbon pricing framework, focusing on carbon trading mechanisms, regulatory implementation structures, performance-based payment systems, and carbon levy provisions. Understanding these mechanisms is essential for businesses preparing for carbon pricing implementation, government agencies developing sector-specific carbon policies, and civil society organizations monitoring Indonesia's climate change mitigation effectiveness.

1.0 Carbon Economic Value Definition and Legal Foundation

Article 1(3) of PERPRES 98/2021 defines Nilai Ekonomi Karbon (NEK) as "nilai terhadap setiap unit emisi gas rumah kaca yang dihasilkan dari kegiatan manusia dan kegiatan ekonomi" (value for every unit of greenhouse gas emissions generated from human activities and economic activities). This definition establishes the core legal principle underlying Indonesia's carbon pricing framework: emissions constitute measurable economic units carrying quantifiable value. The regulation transforms emissions from unpriced externalities into economic goods subject to market transactions, government pricing, and financial accounting. By defining carbon emissions as units with economic value, the regulation creates legal foundations for market-based emission trading systems, carbon taxation, offset mechanisms, and performance-based climate finance.

The regulation distinguishes between two emission categories relevant for NEK implementation. Article 1(7) defines "Emisi GRK" (GHG Emissions) as "lepasnya GRK ke atmosfer pada suatu area tertentu dalam jangka waktu tertentu" (release of GHG to the atmosphere in a certain area within a certain timeframe). This broad definition covers all emission sources—industrial facilities, transportation, agriculture, forestry, waste management, and energy production. Article 1(8) further defines "Unit Karbon" (Carbon Unit) as "satuan yang diperhitungkan untuk menunjukkan besarnya Emisi GRK dan/atau penurunan Emisi GRK atau penyerapan Emisi GRK" (unit calculated to indicate GHG emission magnitude and/or GHG emission reduction or GHG emission absorption). Carbon Units serve as the fundamental measurement unit for NEK systems—one Carbon Unit typically represents one ton of CO2-equivalent (tCO2e) emissions or removals.

Article 2 establishes three NEK objectives: achieving Indonesia's NDC targets, controlling GHG emissions in national development, and supporting climate change adaptation. The first objective directly connects NEK implementation to Indonesia's international commitments under the Paris Agreement. Indonesia's NDC commits to reducing emissions by 29% with domestic resources and up to 41% with international support by 2030 against business-as-usual scenarios. Article 2(a) states NEK implementation aims for "pencapaian target NDC" (achieving NDC targets), creating domestic legal obligations to implement carbon pricing mechanisms that deliver emission reductions sufficient to meet these international commitments.

The second objective focuses on emission control in national development, integrating climate considerations into economic planning. Article 2(b) specifies NEK aims for "pengendalian Emisi GRK dalam pembangunan nasional" (controlling GHG Emissions in national development). This provision requires carbon economic value consideration in development planning across all sectors, ensuring new infrastructure, industrial projects, and economic policies account for carbon costs and emission impacts. The regulation transforms carbon from an ignored environmental variable into a mandatory development planning consideration that influences project selection, technology choices, and investment decisions.

The third objective addresses climate adaptation financing. Article 2(c) includes "dukungan pada program Adaptasi perubahan iklim" (support for climate change Adaptation programs) as an NEK objective. This provision enables NEK revenues—from carbon trading, carbon levies, or international climate finance—to fund adaptation measures protecting Indonesian communities and ecosystems from climate impacts. The regulation recognizes that mitigation alone cannot address climate change; adaptation investments are equally necessary for climate resilience, particularly in vulnerable sectors like agriculture, water resources, and coastal areas. Matrix 1.1 below details NEK definitions and objectives.

Matrix 1.1: Carbon Economic Value Definitions and Objectives

Matrix 1.2: NEK Implementation Objectives

2.0 Carbon Trading Mechanisms: Market-Based Emission Reductions

Article 1(11) of PERPRES 98/2021 defines "Perdagangan Karbon" (Carbon Trading) as "mekanisme berbasis pasar untuk mengurangi Emisi GRK melalui kegiatan jual beli Unit Karbon" (market-based mechanism for reducing GHG Emissions through buying and selling Carbon Units). This definition establishes carbon trading as Indonesia's primary market-based climate policy instrument, enabling businesses to buy and sell emission allowances or carbon offsets through organized markets. Carbon trading creates economic incentives for emission reductions by assigning monetary value to Carbon Units, making it profitable for businesses to reduce emissions below their allocated limits and sell surplus allowances to businesses exceeding their limits.

The regulation establishes two distinct carbon trading mechanisms with different operational structures and emission reduction approaches. Article 47(1)(a) specifies that carbon trading can be implemented through "perdagangan Emisi" (emission trading) and "Offset Emisi GRK" (GHG Emission Offsetting). Emission trading operates as a cap-and-trade system where government sets emission caps for covered entities, allocates emission allowances equal to these caps, and allows entities to trade allowances among themselves. Entities reducing emissions below their allocated allowances can sell surplus allowances to entities exceeding their allowances, creating continuous financial incentives for emission reductions while maintaining overall emission limits consistent with NDC targets.

Article 1(12) defines "Perdagangan Emisi" (Emission Trading) specifically as "mekanisme transaksi antara Pelaku Usaha yang memiliki emisi melebihi Batas Atas Emisi yang ditentukan" (transaction mechanism among Business Actors whose emissions exceed the determined Upper Emission Limit). This provision establishes the cap-and-trade structure—government sets "Batas Atas Emisi" (Upper Emission Limits) for business sectors or individual facilities, creating emission caps that participating entities cannot exceed without purchasing additional allowances. Entities emitting below their upper limits hold surplus allowances that can be sold on carbon markets, while entities exceeding limits must purchase allowances or face compliance penalties.

Article 1(13) defines "Offset Emisi GRK" (GHG Emission Offsetting) as "pengurangan Emisi GRK yang dilakukan oleh usaha dan/atau kegiatan untuk mengkompensasi emisi yang dibuat di tempat lain" (GHG Emission reduction conducted by business and/or activity to compensate emissions made elsewhere). Offsetting enables businesses to compensate for their emissions by purchasing emission reduction credits generated by other projects or activities. For example, an industrial facility exceeding emission limits can purchase carbon credits from forestry projects that sequester carbon, renewable energy projects that avoid fossil fuel emissions, or energy efficiency programs that reduce consumption. Offsetting differs from emission trading by allowing cross-sectoral transactions—emitters can compensate emissions through entirely different activities rather than trading allowances within a capped sector.

Article 47(2) specifies that carbon trading can occur "di dalam negeri dan/atau luar negeri" (domestically and/or internationally), enabling both domestic Indonesian carbon markets and international carbon trading under Paris Agreement Article 6 mechanisms. Domestic trading creates national carbon markets where Indonesian entities trade Carbon Units according to Indonesian regulations and emission caps. International trading enables Indonesian entities to participate in global carbon markets, selling carbon credits internationally or purchasing international offsets to meet Indonesian compliance obligations. This international trading provision aligns with Paris Agreement Article 6, which establishes cooperative approaches allowing countries to trade emission reductions internationally toward achieving their NDCs.

Article 50 establishes the Bursa Karbon (Carbon Exchange) as Indonesia's official carbon trading platform, defined in Article 1(20) as "suatu sistem yang mengatur mengenai pencatatan cadangan karbon, Perdagangan Karbon, dan status kepemilikan Unit Karbon" (a system that regulates carbon reserve recording, Carbon Trading, and Carbon Unit ownership status). The Carbon Exchange provides organized market infrastructure where registered entities can buy and sell Carbon Units through transparent pricing mechanisms, standardized contract terms, and centralized clearing and settlement systems. Article 50(3) requires the Carbon Exchange operator to obtain licenses from Otoritas Jasa Keuangan (OJK / Financial Services Authority), ensuring carbon markets operate under financial market supervision with appropriate investor protections, market integrity safeguards, and anti-manipulation rules. Matrix 2.1 below details carbon trading mechanisms and definitions.

Matrix 2.1: Carbon Trading Mechanisms and Definitions

Matrix 2.2: Carbon Trading Geographic Scope

3.0 Performance-Based Payments and Results-Based Finance

Article 47(1)(b) of PERPRES 98/2021 establishes "pembayaran berbasis kinerja" (performance-based payments) as a second primary NEK implementation mechanism. Performance-based payments function as results-based finance instruments where entities receive payments contingent upon achieving verified emission reductions or carbon sequestration measured against predetermined baselines. Unlike carbon trading where entities exchange Carbon Units in markets, performance-based payments flow directly from funders (typically governments or international climate finance institutions) to emission reduction implementers based on performance verification against agreed metrics.

The regulation defines performance-based payments' legal foundation in Article 47(3)(b), specifying these payments require "verifikasi atas pencapaian target penurunan Emisi GRK dan/atau penyerapan Emisi GRK" (verification of achievement of GHG Emission reduction targets and/or GHG Emission absorption). This verification requirement creates a pay-for-performance structure—payments occur only after independent third-party verification confirms that emission reductions or removals actually occurred according to approved methodologies and measurement protocols. Verification prevents payments for claimed reductions that did not materialize, ensuring climate finance effectiveness by linking payments directly to measurable environmental outcomes.

Performance-based payments serve particularly important functions in Indonesia's forestry and land-use sectors where carbon trading faces technical challenges related to permanence, leakage, and additionality verification. Indonesia's REDD+ (Reducing Emissions from Deforestation and Forest Degradation) programs utilize performance-based payments extensively, with international funders including Norway, Germany, and multilateral climate funds providing payments based on verified reductions in deforestation-related emissions. These programs measure Indonesia's forest cover changes through satellite monitoring, calculate corresponding emission reductions against historical baselines, and disburse payments proportional to verified reductions—creating direct financial incentives for forest conservation and restoration.

Article 47(3)(b) also addresses payment timing and structure, stating performance-based payments occur "setelah dilakukan verifikasi" (after verification is conducted). This post-verification payment structure differs from traditional development finance where funds disburse before project implementation based on planned activities. Performance-based finance shifts risk from funders to implementers—implementers must invest in emission reduction activities upfront without guaranteed payment, receiving compensation only after verification confirms performance achievement. This results-oriented approach incentivizes effective implementation rather than mere activity completion, focusing accountability on environmental outcomes rather than procedural compliance.

The regulation enables performance-based payments from both domestic and international sources. Article 54 specifies that NEK implementation funding can derive from "Anggaran Pendapatan dan Belanja Negara (APBN), anggaran pendapatan dan belanja daerah (APBD), dan/atau sumber lain yang sah" (State Revenue and Expenditure Budget, regional revenue and expenditure budget, and/or other legitimate sources). Other legitimate sources include international climate finance mechanisms such as the Green Climate Fund, bilateral climate partnerships, and private sector climate investment funds. This multi-source funding structure enables Indonesia to leverage both domestic budgets and international climate finance for NEK implementation, maximizing available resources for emission reduction activities.

Article 55 establishes specific provisions for international climate cooperation, stating Indonesia can engage in "kerja sama internasional dalam penyelenggaraan NEK" (international cooperation in NEK implementation). This provision authorizes bilateral climate finance agreements like Indonesia's partnerships with Norway, Germany, and the United Kingdom supporting forest conservation and emission reduction programs. International cooperation enables technology transfer, capacity building, and financial resources exceeding Indonesia's domestic capacity, accelerating NDC achievement through global climate partnerships. Matrix 3.1 below details performance-based payment structures and verification requirements.

Matrix 3.1: Performance-Based Payment Mechanisms

Matrix 3.2: Performance-Based Payment Funding Sources

4.0 Carbon Levies and Direct Carbon Pricing

Article 47(1)(c) of PERPRES 98/2021 establishes "pungutan atas karbon" (levies on carbon) as a third primary NEK implementation mechanism. Carbon levies function as direct pricing instruments where government imposes charges on carbon emissions, creating explicit financial costs for emitting activities. Unlike carbon trading where markets determine Carbon Unit prices through supply and demand dynamics, carbon levies establish administratively determined prices that government can adjust to achieve emission reduction targets or generate climate finance revenues. Carbon levies transform carbon emissions from free externalities into priced activities where emitters pay per ton of CO2-equivalent emissions, creating continuous financial incentives to reduce emissions and avoid levy payments.

The regulation defines carbon levies' legal basis in Article 1(21), which specifies "Pungutan atas Karbon" as "pungutan yang dikenakan atas Emisi Karbon yang dilakukan oleh pelaku usaha" (levy imposed on Carbon Emissions conducted by business actors). This definition establishes carbon levies as mandatory charges applied to business sector emissions based on measured emission quantities. The levy structure requires businesses to calculate their carbon emissions using approved methodologies, report emissions to relevant authorities, and pay levies proportional to reported emissions. Government can set differential levy rates across sectors, emission sources, or entity sizes, creating flexible pricing structures that account for sectoral circumstances and economic impacts.

Carbon levies serve multiple policy objectives beyond emission reductions. Article 2(b) connects NEK implementation including carbon levies to "pengendalian Emisi GRK dalam pembangunan nasional" (controlling GHG Emissions in national development), establishing emission control as a primary levy objective. However, Article 2(c) also links NEK to "dukungan pada program Adaptasi perubahan iklim" (support for climate change Adaptation programs), indicating that carbon levy revenues can fund adaptation investments. This dual-purpose structure enables carbon levies to simultaneously incentivize emission reductions through pricing signals while generating revenues for climate investments including adaptation measures, renewable energy deployment, and green infrastructure development.

The regulation does not specify carbon levy rates, implementation timelines, or covered sectors in PERPRES 98/2021 itself. Instead, Article 47(4) grants authority to "Menteri yang menyelenggarakan urusan pemerintahan di bidang lingkungan hidup" (Minister conducting government affairs in the environmental field) to establish technical regulations for NEK implementation including carbon levies. This delegation enables the Ministry of Environment and Forestry to develop detailed carbon levy regulations through ministerial decrees, creating implementation flexibility that allows phased rollout, pilot programs, and adaptive management based on early implementation experience. Ministerial regulations can specify levy rates, phase-in schedules, exemptions, revenue allocation mechanisms, and compliance procedures without requiring presidential regulation amendments.

Article 13 establishes sector-specific emission reduction targets as foundations for carbon levy implementation, stating "Pemerintah Pusat menetapkan target penurunan Emisi GRK pada sektor: a. kehutanan; b. energi; c. pertanian; d. industri; e. pengelolaan limbah; dan/atau f. sektor lain" (Central Government establishes GHG Emission reduction targets in sectors: a. forestry; b. energy; c. agriculture; d. industry; e. waste management; and/or f. other sectors). These sector-specific targets provide benchmarks for carbon levy design—government can calibrate levy rates to drive emission reductions sufficient to achieve sectoral targets. For example, higher levy rates in electricity generation sectors can accelerate renewable energy adoption, while differentiated rates in industrial sectors can account for varying decarbonization potential across industries.

Article 48 addresses levy implementation flexibility, stating NEK mechanisms can be "diterapkan sendiri-sendiri atau kombinasi" (applied individually or in combination). This provision enables hybrid approaches combining carbon levies with carbon trading or performance-based payments. For example, Indonesia could implement carbon trading in electricity generation while applying carbon levies to transportation fuels and performance-based payments to forestry, creating sector-specific policy mixes optimized for each sector's characteristics. Hybrid approaches recognize that no single carbon pricing instrument suits all sectors, requiring flexible policy designs that match instruments to sectoral contexts. Matrix 4.1 below details carbon levy provisions and implementation structures.

Matrix 4.1: Carbon Levy Framework and Implementation

Matrix 4.2: Sector-Specific Emission Reduction Targets

5.0 Governance, Coordination, and Transparency

Article 59 of PERPRES 98/2021 establishes the Komite Pengarah Nilai Ekonomi Karbon (NEK Steering Committee) as the supreme national coordination body for NEK implementation. Article 59(1) specifies the committee composition: "Komite Pengarah NEK beranggotakan menteri dan/atau pimpinan lembaga terkait yang ditetapkan oleh Presiden" (NEK Steering Committee consists of ministers and/or heads of related institutions appointed by the President). This ministerial-level composition ensures high-level government coordination across all sectors contributing to emissions or implementing mitigation measures. The committee's authority extends across government ministries, enabling unified policy direction that prevents fragmented approaches undermining NDC achievement.

Article 60 enumerates seven specific NEK Steering Committee functions demonstrating comprehensive oversight authority. Article 60(a) grants authority to "merumuskan kebijakan strategis penyelenggaraan NEK" (formulate strategic policies for NEK implementation), establishing the committee as Indonesia's primary carbon pricing policy-making body. This strategic policy authority enables the committee to determine which NEK mechanisms apply to which sectors, establish carbon pricing trajectories over time, coordinate international climate cooperation, and adapt policies based on implementation experience. The committee functions as Indonesia's carbon pricing governance apex, translating NDC commitments into operational carbon pricing policies across all government sectors.

Article 60(b) grants the committee authority to "mengintegrasikan dan mengoordinasikan penyelenggaraan NEK" (integrate and coordinate NEK implementation), addressing coordination challenges inherent in cross-sectoral climate policy. Carbon pricing implementation requires coordination between the Ministry of Environment and Forestry (overall NEK coordination), Ministry of Energy and Mineral Resources (energy sector emissions), Ministry of Industry (industrial emissions), Ministry of Finance (carbon levy revenue management), Otoritas Jasa Keuangan (carbon exchange supervision), and numerous other agencies. The committee's coordination function prevents policy conflicts, ensures consistent carbon accounting methodologies across sectors, and facilitates data sharing enabling comprehensive emission tracking.

Article 61 establishes the Kelompok Kerja Penyelenggaraan NEK (NEK Implementation Working Group) as the technical implementation body supporting the Steering Committee. Article 61(2) specifies the working group's technical functions: "pelaksanaan tugas teknis penyelenggaraan NEK" (implementation of technical tasks for NEK implementation). The working group handles operational implementation including carbon unit registration systems, verification protocols, carbon exchange technical standards, emission reporting requirements, and stakeholder capacity building. This two-tier governance structure separates strategic policy-making (Steering Committee) from technical implementation (Working Group), enabling ministerial-level officials to focus on strategic direction while technical experts handle implementation details.

Article 68 establishes comprehensive transparency requirements through the Registri Nasional Pengendalian Perubahan Iklim (National Climate Change Control Registry). Article 68(1) defines the registry as "sistem elektronik pencatatan dan pelaporan kegiatan dan data aksi mitigasi, aksi Adaptasi, dan dukungan untuk penyelenggaraan pengendalian perubahan iklim secara nasional" (electronic system for recording and reporting mitigation action activities and data, Adaptation actions, and support for implementing national climate change control). The registry provides centralized digital infrastructure tracking all NEK implementation activities, Carbon Unit transactions, emission reductions, carbon trading volumes, performance-based payment disbursements, and carbon levy collections. This transparency infrastructure enables public monitoring of Indonesia's NDC progress and creates accountability mechanisms ensuring NEK implementation drives actual emission reductions.

Article 69 specifies transparency framework requirements, stating the registry must record "Perdagangan Karbon; hasil dari pembayaran berbasis kinerja; hasil dari Pungutan atas Karbon" (Carbon Trading; results from performance-based payments; results from Carbon Levies). This comprehensive recording requirement creates transparent tracking of all three primary NEK mechanisms, enabling analysis of which mechanisms deliver greatest emission reductions at lowest costs and informing future policy adjustments. Article 70 requires the government to publish periodic NDC achievement reports based on registry data, creating regular public accountability for Indonesia's climate commitments. Matrix 5.1 below details governance structures and transparency provisions.

Matrix 5.1: NEK Governance and Coordination Structures

Matrix 5.2: Transparency and Accountability Mechanisms

Matrix 5.3: NEK Steering Committee Strategic Functions

Conclusion

PERPRES 98/2021 establishes Indonesia's comprehensive carbon economic value framework, creating legal foundations for carbon pricing, carbon trading, and market-based climate change mitigation. The regulation's four-mechanism approach—carbon trading, performance-based payments, carbon levies, and additional mechanisms—provides flexible policy instruments enabling Indonesia to implement sector-appropriate carbon pricing across all emission sources. By assigning economic value to carbon emissions through the NEK concept, the regulation transforms emissions from unpriced externalities into quantifiable economic units subject to market transactions, government pricing, and performance-based finance.

The regulation directly operationalizes Indonesia's international climate commitments under the Paris Agreement, creating domestic legal obligations to achieve NDC targets through systematic carbon pricing implementation. The establishment of the NEK Steering Committee ensures ministerial-level coordination across government sectors, while the National Climate Change Control Registry creates transparency infrastructure enabling public monitoring of Indonesia's emission reduction progress. Businesses operating in Indonesia should prepare for phased carbon pricing implementation across sectors as implementing regulations specify carbon trading caps, performance-based payment programs, and carbon levy rates. Understanding PERPRES 98/2021's framework is essential for anticipating Indonesia's climate policy trajectory and positioning businesses for the transition to a carbon-constrained economy.

Regulation Reference

Full Citation:
Peraturan Presiden Republik Indonesia Nomor 98 Tahun 2021 tentang Penyelenggaraan Nilai Ekonomi Karbon untuk Pencapaian Target Kontribusi yang Ditetapkan Secara Nasional dan Pengendalian Emisi Gas Rumah Kaca dalam Pembangunan Nasional

English Translation:
Presidential Regulation of the Republic of Indonesia Number 98 of 2021 on Implementation of Carbon Economic Value for Achieving Nationally Determined Contribution Targets and Greenhouse Gas Emission Control in National Development

Short Citation:
PERPRES 98/2021

Promulgation Date: October 29, 2021
Effective Date: October 29, 2021
Legal Hierarchy: Presidential Regulation (Peraturan Presiden)

Official Source: https://peraturan.bpk.go.id/Details/187122/perpres-no-98-tahun-2021

Implementing Regulations:
- Peraturan Menteri Lingkungan Hidup dan Kehutanan Nomor 21 Tahun 2022 tentang Tata Laksana Penerapan Nilai Ekonomi Karbon

Legal Analysis by the CRPG Climate Policy Team | Analysis Date: November 26, 2025 | Regulation Effective: October 29, 2021

LEGAL DISCLAIMER: This article is provided for informational and educational purposes only and does not constitute legal advice, legal opinion, or professional consultation. The analysis presented herein is based on the authors' interpretation of PERPRES 98/2021 and related regulations as of the publication date and may contain errors, omissions, or inaccuracies despite reasonable efforts to ensure accuracy. Laws and regulations are subject to amendment, judicial interpretation, and administrative clarification that may affect the applicability or interpretation of the provisions discussed. This article does not create an attorney-client relationship between the authors, the Center for Regulation, Policy and Government (CRPG), and any reader. Readers should not act or refrain from acting based solely on the information contained in this article without seeking appropriate legal counsel from qualified Indonesian legal practitioners licensed to practice environmental and climate law. The application of carbon pricing requirements depends on specific factual circumstances including business sector classification, emission sources, production scale, geographic location, and implementing regulation specifications, all of which require case-specific legal analysis. Neither the authors nor CRPG assume any liability for actions taken or not taken based on information in this article, nor for any direct, indirect, incidental, consequential, or punitive damages arising from use of or reliance on this material. For specific legal guidance on carbon economic value requirements under PERPRES 98/2021, consult with qualified legal counsel familiar with Indonesian environmental, climate, and administrative law and current regulatory practice.

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