Indonesia has an ambitious 20% blending mandate for biodiesel in transport diesel fuel and relies almost entirely on palm oil to meet this target. This white paper assesses the potential of used cooking oil (UCO) as a biofuel feedstock in Indonesia.
We find that with easily implementable UCO collection programs in cities, Indonesia could produce 121 million liters of low carbon biodiesel per year. While more challenging to do, collecting UCO from urban households could increase the potential by ten-fold and save 6 million tonnes of CO2 emissions annually. We also find that the cost of producing UCO biodiesel is much lower than producing biodiesel from crude palm oil, mainly because UCO is a waste product. Supporting UCO biodiesel would help the government meet their biofuel blending mandate at a lower cost. In addition, transforming UCO into biodiesel comes with ecological benefits of avoiding UCO disposal into the local waterways and landfill as well as health benefits of avoiding UCO reuse in food.
UCO biodiesel should be incorporated into Indonesia’s biodiesel blending mandate, which would secure the market for UCO biodiesel producers. In addition, Indonesia could set a standard for UCO biodiesel quality. This step may help biofuel producers control their UCO feedstock quality and refining process. Supporting used cooking oil collection and biofuel production could be a powerful tool for Indonesia to contribute towards its energy independence and climate mitigation goals, while saving money on its biofuels program.