PBPH Forest Utilisation Business Licences and Carbon

Updated 2026-11-02 · 4 min read · By the akar.earth specialist team

PBPH karbon explained: how Indonesia's forest utilisation business licences allow carbon storage and sequestration under multi-business forestry rules.

A PBPH (Perizinan Berusaha Pemanfaatan Hutan) is Indonesia’s forest utilisation business licence, and under PP 23/2021 a PBPH holder can run several businesses in one licence area, including carbon storage and sequestration. That makes concession holders one of the main routes for forest carbon projects in Indonesia, now governed procedurally by Permenhut 6/2026.

What a PBPH is

The PBPH was introduced through the Job Creation (Cipta Kerja) reforms and their implementing regulation on forestry, PP 23/2021. It replaced a set of older licences, such as the natural forest and plantation timber licences known as IUPHHK-HA and IUPHHK-HT, with a single risk-based business licence for utilising state forest. For a short definition, see the PBPH glossary entry.

A key change is multi-business forestry (multiusaha kehutanan). Instead of one licence for one product, a PBPH holder can combine activities in the same area, such as:

• timber from natural forest or plantations;
• non-timber forest products;
• environmental services, including carbon storage and sequestration;
• ecotourism and water services.

The exact list and conditions are in PP 23/2021 and its ministerial implementing rules. Check the current texts, because several implementing rules have been revised.

Who it applies to

• Existing concession holders in production forest, including former logging and pulpwood companies, which converted to PBPH.
• Ecosystem restoration licence holders, whose earlier licence type was folded into the PBPH system. Restoration concessions have hosted some of Indonesia’s best-known REDD+ projects.
• New applicants for forest utilisation, subject to the primary forest moratorium and peat rules.
• Partners and communities working inside PBPH areas through forestry partnership (Kemitraan Kehutanan), one of the social forestry schemes.

What it requires and changes for carbon

A PBPH holder that wants to trade carbon must follow the forestry carbon procedure. Under Permenhut 6/2026, socialised on 29 April 2026, the flow runs from the mitigation activity, through measurement and calculation, validation and verification, and recording in the national registry (SRUK), to trading. Each stage has a time limit.

Speakers at the Ministry’s socialisation covered carbon trading in production forest utilisation alongside social forestry and conservation areas, so PBPH is one of the main use cases. The earlier forestry procedure, Permen LHK 7/2023, also set out rules for licence holders. Check whether and how it has been replaced.

Other duties continue alongside carbon. Licence holders still have management plans, reporting and fees under forestry law, plus peat and fire obligations where relevant.

What it means for developers and buyers

For concession holders: carbon can become a core business line, not a side project. Typical project types are:

• avoided planned deforestation, where a licence permitted conversion that the holder forgoes;
• improved forest management, such as reduced-impact logging or extended rotations;
• restoration and enrichment planting on degraded parts of the concession (ARR).

Additionality and baselines are the main technical issues. If the licence or management plan already restricts clearing, the baseline must reflect that. BeZero notes that all three Indonesian REDD+ projects in its portfolio are avoided planned deforestation with peatland conservation, which shows both the importance and the scrutiny of this project type.

For buyers: check that the PBPH is valid for the crediting period, that the licence allows carbon activities, that units are recorded in SRUK, and how communities inside or next to the concession share benefits. Our buyer due diligence covers licence review.

Community overlaps. Many concessions overlap community or customary claims. Projects need FPIC and clear benefit sharing to be credible, and Permenhut 6/2026 puts weight on community participation.

Practical checklist for a PBPH carbon project

• Confirm the licence number, area, term and the activities it allows, including any multi-business approval.
• Check the current management plan and whether it already limits clearing or harvest.
• Overlay the licence area on peat, moratorium and community claim maps.
• Identify communities inside or next to the area and plan consent and partnership early.
• Decide which international standard and methodology fit, and whether units will also be offered domestically on IDXCarbon.

Open questions

• Licence term vs permanence. PBPH terms are long but finite. How permanence obligations beyond the licence term are handled needs legal review.
• Fees and levies on carbon. We have not confirmed any specific state levy or fee on PBPH carbon revenue. Read the current regulations and do not assume a rate.
• Authorisation for export. Whether PBPH carbon units can be authorised for corresponding adjustments, and on what terms, is not fully clear.
• Transition from older licences. Projects started under older licence types should confirm their status under the PBPH system.

Our Indonesia regulatory navigation service reviews licence status and carbon rights for concession projects. For more, see the Indonesia regulation hub.