President to Inaugurate Carbon Exchange Launch Tomorrow

The Financial Services Authority (OJK) will launch carbon exchange trading on Tuesday next week (26/9/2023).

In this important momentum, President Joko Widodo (Jokowi) is scheduled to inaugurate the opening of the Indonesia Carbon Exchange organized by the Indonesia Stock Exchange (IDX).

Based on the schedule of the Indonesia Carbon Exchange Launch obtained by Market sources, it is noted that President Jokowi will launch the inauguration of the Indonesia Carbon Exchange at the Main Hall of the IDX.

The inauguration procession of the Indonesia Carbon Exchange by President Jokowi is scheduled at 09.27 WIB-09.30 WIB which will be accompanied by a number of ministers, representatives of the OJK, DPR RI, and IDX equipment as the organizer of the Carbon Exchange.

The IDX has indeed obtained a business license as a carbon exchange organizer after the submission of applications and submission of requirements as a carbon exchange organizer to the Financial Services Authority (OJK) reached a final agreement. The business license decision was given based on KEP-77/D/04/2023 last Monday (18/09/2023).

It is worth looking forward to how the combination of various trading mechanisms will be organized on the carbon exchange. Previously, a spill related to this trading mechanism was revealed by the President Director of the IDX, Iman Rachman.

Then, referring to the SK Direksi PT BEI released last week, there are four market mechanisms for carbon trading through the exchange, including the regular market, auction market, negotiation market, and marketplace market.

First, the Regular Market is a market used by Carbon Exchange Service Users to enter sale offers and/or purchase requests, and the Carbon Exchange matches on a continuous basis (continuous auction) for sale offers with purchase requests for the same series of Carbon Units either in whole or in part.

Second, the auction market is a market that can be used by the relevant Ministries and Project Owners to conduct auctions to Carbon Exchange Service Users. This market is a one-way sale from the project owner, like an IPO (initial public offering).

Third, the negotiation market is a market used by Carbon Exchange Service Users to enter the results of the bargaining agreement into the Carbon Exchange and the Carbon Exchange Service Users counterparty confirming the results of the bargaining agreement.

Fourth, the non-regular market will resemble a typical marketplace. The market will be used by the Project Owner to submit the SPE-GRK selling offer and the Carbon Exchange Service User (counterparty) conveys the result of the bidding agreement to the Carbon Exchange.

IDX Director of Development, Jeffrey Hendrik, emphasized that a good Carbon Exchange infrastructure and ecosystem is where there is sufficient supply and demand, as well as the development of better trading and supervisory systems.