Perpres 98/2021 on Carbon Economic Value (NEK)

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

Perpres 98/2021 explained: how Indonesia's 2021 carbon economic value (NEK) regulation set up carbon trading, and what still matters after Perpres 110/2025.

Perpres 98/2021 is the Presidential Regulation that created Indonesia’s carbon economic value framework, known as NEK (Nilai Ekonomi Karbon). Signed in October 2021, it made carbon trading, results-based payment and carbon levies official tools for reaching Indonesia’s NDC, and it was the base layer for every carbon rule that followed until Perpres 110/2025 reworked it.

What Perpres 98/2021 is

The full title translates roughly as “Implementation of Carbon Economic Value to Achieve the Nationally Determined Contribution and Control Greenhouse Gas Emissions in National Development”. It did three things at a high level:

• It tied all carbon pricing in Indonesia to the national climate target, the NDC. Carbon was treated first as a tool for national accounting, then as a tradeable commodity.
• It named the NEK instruments: carbon trading (both emissions trading and emissions offsetting), results-based payment, carbon levies (pungutan atas karbon) and other mechanisms set by the relevant minister.
• It made the national registry, SRN-PPI, the place where mitigation actions and their results had to be recorded.

The regulation covered the main emitting sectors, including energy, waste, industrial processes and product use, agriculture and forestry. Forestry and land use mattered most because that sector carries the largest share of Indonesia’s planned emission reductions.

Who it applied to

Perpres 98/2021 set duties for ministries and gave them the job of writing detailed rules. The businesses it reached were:

• Companies in sectors given emission caps, which later received allowances (see PTBAE-PU).
• Project developers and licence holders running mitigation actions, including forest concession holders and social forestry groups, whose results could become offsets (see SPE-GRK).
• Buyers, domestic and foreign, who wanted credits from Indonesian activities.

Most practical requirements came through implementing rules, especially Permen LHK 21/2022 on NEK procedures and Permen LHK 7/2023 on forestry carbon trading.

What it required and changed

Before 2021, Indonesian forest carbon projects mostly ran under international standards such as the Verra VCS Program with little domestic oversight. Perpres 98/2021 changed that in four ways:

1. National accounting first. Emission reductions had to count towards the NDC. That created the question every foreign buyer still asks: can a credit leave Indonesia without being counted twice? (See corresponding adjustments.)
2. Registration. Mitigation actions and their outcomes had to be recorded in SRN-PPI.
3. Government approval. Trading, and especially international transfer, needed ministerial involvement. The regulation set the principle; later rules set the steps.
4. Domestic certificates. It paved the way for the SPE-GRK, Indonesia’s own emission reduction certificate, and for the IDXCarbon exchange launched in 2023.

What it meant for forest carbon developers and buyers

For developers, Perpres 98/2021 introduced a domestic layer on top of international certification. Projects needed to align with national registration, and several existing projects faced uncertainty about whether credits already issued under international standards could still be sold abroad.

Market analysts link that uncertainty to weak prices. Research by BeZero finds Indonesian nature-based credits average an ‘A’ rating, against ‘B’ as the most common rating for such credits elsewhere, yet they still trade at a fraction of real abatement cost. The reasons cited are regulatory uncertainty, high domestic abatement costs and restrictive compliance eligibility. An IETA policy paper from 2025 goes further and says international carbon finance to Indonesia effectively stalled after the earlier NDC-alignment rules.

For buyers, the practical lesson was to check two things for any Indonesian credit: its international certification and its standing under Indonesian law. That check is still needed today; see our guide to buyer due diligence.

Perpres 98/2021 after Perpres 110/2025

Perpres 110/2025 is now the legal anchor for carbon trading. Secondary sources describe it as changing provisions of Perpres 98/2021 rather than starting from zero, so much of the NEK vocabulary (instruments, NDC alignment, registry, ministerial roles) carries over. What changed most visibly in 2026 is the plumbing:

Open questions

• Which provisions survive? Read the closing and transitional articles of Perpres 110/2025 to see whether Perpres 98/2021 is revoked in full or amended. We do not state this here because secondary sources describe it differently.
• Status of older approvals. Projects approved or registered under the 98/2021 rules may need to migrate records into SRUK. Confirm with the relevant ministry.
• Legacy credits. How pre-2021 or pre-registration vintages are treated for international transfer remains a question to settle project by project.

For a dated overview, see the regulation timeline and the Indonesia regulation hub. If you need a project-specific reading, our regulatory navigation service maps a project against the current texts.