7.1 Indonesia

7.1.1 Introduction

The Indonesian Government's environmental policies are established through the Environmental Management Act 1997 and associated regulations and guidelines administered through the Ministry of Environment. The Ministry, however, lacks executorial and monitoring powers, which are still in the hands of sectoral departments or local authorities. The objective of the Act is stated as follows:

Environmental management which is performed with a principle of national responsibility, a principle of sustainability, and a principle of exploitation, aims to create environmentally sustainable development in the framework of the holistic development of the Indonesian human and the development of an Indonesian community in its entirety which is faithful and devoted to God the Almighty.

A key feature of the policy is the need to prepare an Environmental Impact Analysis (EIA), which is required under Article 18 of the Environmental Management Act 1997. Every business which gives rise to a "large and important impact on the environment" must possess an EIA to obtain the licence to conduct a business and/or activity. It seems likely that CO2 transport and storage activities would require an EIA.

EIA are requirements are considered further in Articles 19, 20 and 21 and include that:

Article 19

  1. In issuing a license to carry out a business and/or activity it is compulsory to take into account:
  2. a. spatial management plans;

    b. public opinion;

    c. considerations and recommendations of authorized officials who are involved with such business and/or activity.

  3. The license to conduct a business and/or activity decision must be made public.

Article 20

  1. Without a licensing decision, every person is prohibited from disposing of waste to an environmental medium.
  2. Every person is prohibited from disposing of waste which originates from outside Indonesian territory to an Indonesian environmental medium.
  3. The authority to issue or refuse a licensing application as provided for in (1) above lies with the Minister.
  4. Waste disposal to an environmental medium as provided for in (1) above may only be carried out at a disposal site which is determined by the Minister.
  5. Implementing provisions for this Article are regulated further by government regulation.

Article 21

Every person is prohibited from importing hazardous and toxic wastes.

More detailed regulations on EIAs and associated requirements (including requirements for an environmental management plan, environmental monitoring plan and a commission of assessment) are set out in Government Regulation No. 27/1999.

7.1.2 Regulations that might assist

The clearest assistance that can be provided by Indonesia's environmental policies, legislation and regulation that might positively assist in facilitating CO2 transport and storage in Indonesia would be the ability to conduct an EIA and obtain a licence to operate under the Environmental Management Act 1997.

This would allow CO2 transport and storage activities to proceed through consideration under the EIA process and potentially be approved for development. It should be noted that such a process, while vital to facilitating CO2 transport and storage in Indonesia, would be secondary to establishing a legislative and regulatory framework for CO2 transport and storage activities, including titling and permitting arrangements.

7.1.3 Obstacles

Directly related to the section above, the major hindrance to CO2 transport and storage arising from Indonesia's environmental policies, legislation and regulation is likely to be the fact that no CO2 transport and storage activity has yet conducted an EIA and obtained a licence to operate under the Environmental Management Act 1997. First mover disadvantages may face the first project to do so.

It should be noted that such a process, while vital to facilitating CO2 transport and storage in Indonesia, would be secondary to establishing a legislative and regulatory framework for CO2 transport and storage activities, including titling and permitting arrangements.

7.1.4 Omissions

While CO2 transport and storage activities do not appear to be precluded by the Environmental Management Act 1997, it would appear that an overarching legislative and regulatory framework would need to be developed and implemented in Indonesia before such activities could proceed. Any necessary amendments to the Environmental Management Act 1997 could be considered as part of this process.