Wednesday, December 6, 2023

IDX Set to Launch Carbon Trading Platform

Indah Handayani & Heru Andriyanto
September 21, 2023 | 6:16 pm
The IDX Logo is displayed at the Indonesia Stock Exchange building in Jakarta. (B-Universe Photo/Mohammad Defrizal)
The IDX Logo is displayed at the Indonesia Stock Exchange building in Jakarta. (B-Universe Photo/Mohammad Defrizal)

Jakarta. The Indonesia Stock Exchange (IDX) is gearing up to introduce carbon trading on September 26, providing a platform for corporations and project developers to engage in the voluntary buying and selling of carbon credits.

Registration for the inaugural carbon trading opened on Tuesday, and eligible users will be able to establish their accounts starting from Friday. Users are required to participate in a specialized training program hosted by the IDX.

"The trading system is fully operational, and the IDX is prepared for the launch. We hope to see transactions taking place on the launch date," Jeffrey Hendrik, IDX Business Development Director, said in an interview with business newspaper Investor Daily on Thursday.

According to Hendrik, numerous companies have shown interest in applying for membership in the carbon trading platform, while others are making inquiries about this new offering by the IDX.


What is Carbon Trading?
Carbon trading, as explained by research firm NH Korindo Sekuritas Indonesia (NHKSI), involves the buying and selling of credits that permit corporations to emit a specified quantity of carbon dioxide or greenhouse gas emissions.

For instance, Company A, with low carbon emissions, can sell carbon credits to major carbon emitters like cement factories or coal-fired power plants in the marketplace, as illustrated by NHKSI.

IDX Set to Launch Carbon Trading Platform
Illustration of carbon trading. (NHKSI)

These transactions predominantly involve corporations, brokers, and project developers. To make this system effective, carbon trading relies on a reputable and legally mandated institution to verify emission standards.

According to the IDX, mining and energy companies have shown interest in participating in carbon trading. Some of the notable names include Barito Pacific, Pertamina Geothermal Energy, Indika Energy, Bukit Asam, Arkora Hydro, Carsurin, Kencana Energy Lestari, Mutuagung Lestari, SLJ Global, Integra Indocabinet, and Barito Renewables Energy.

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