akar.earthNEK: Definition
What is NEK (Nilai Ekonomi Karbon)? Indonesia's carbon pricing framework, from Perpres 98/2021 to Perpres 110/2025, and its instruments explained.
NEK (Nilai Ekonomi Karbon, or carbon economic value) is Indonesia’s national framework for putting a price on greenhouse gas emissions and reductions to help meet its NDC. It was established by Perpres 98/2021, and Perpres 110/2025 is now the main legal anchor for its instruments, including carbon trading.
Why it matters
NEK defines who can generate, own, trade and use carbon units in Indonesia, and on what terms. Every forest carbon project in the country, whether selling domestically or abroad, operates within it. Changes to NEK rules have repeatedly affected the value and exportability of Indonesian credits, which is one reason prices remain low relative to real abatement costs.
How it works
The framework from Perpres 98/2021 set out several instruments:
- Carbon trading: emissions trading (allowances such as PTBAE-PU) and offsetting (SPE-GRK certificates).
- Results-based payments for verified mitigation.
- Carbon levies, linked to the carbon tax.
- Other mechanisms set by ministers.
Perpres 110/2025 revised the framework. Implementing rules followed: POJK 10/2026 on exchange trading (applying from 6 July 2026), SRUK as the registry for tradable units, Permenhut 6/2026 for forestry and Permen LH/BPLH 11/2026 for waste.
Indonesia and Southeast Asia angle
For forestry, NEK interacts with FOLU Net Sink 2030, social forestry and customary forest rights. Permenhut 6/2026 frames forestry carbon as “carbon for the people” and names communities as equal participants. Developers must check sector-specific rules on authorisation, registration and benefit sharing. Our regulation timeline tracks the sequence.
For projects, the practical steps under NEK usually include registering the mitigation action, using an approved methodology, getting verified results, recording units in SRUK and following rules on domestic and international transfer. Each step has its own ministry and timeline, so plan with time to spare and keep primary texts on file.
Common mistakes
- Citing only Perpres 98/2021 as if it were still the full rulebook.
- Assuming international standard registration is enough without national recording.
- Overlooking sector-specific ministerial rules.
Start at the Indonesia regulation hub.
Frequently asked questions
Which regulation governs NEK today?
Perpres 110/2025 on the implementation of carbon economic value instruments and national greenhouse gas emission control is the current legal anchor. It amended the framework first set by Perpres 98/2021.
What instruments does NEK include?
The framework set by Perpres 98/2021 covers carbon trading, results-based payments, carbon levies and other mechanisms. Check Perpres 110/2025 for current details.