Indonesia’s road freight is key for road transport decarbonisation and fiscal savings

The Indonesian government can leverage the current disruptions in global oil supply chains as a catalyst for road freight electrification, allowing the nation to transition away from its dependency on diesel imports and the associated fiscal burden of subsidies. The Zero-Emission Truck (ZET) pathway indicates that Indonesia must roll out over 12 million electric trucks by 2060, a new T&E’s joint study with IESR shows.

Each electric truck avoids IDR 21 million (approx 1,023 Euros) per year in diesel subsidies, compensation, and palm oil fund (BPDPKS) incentives by 2030. The number is projected to rise to IDR 50 million by 2060. Delaying the introduction of sales mandates results in the continued sale of diesel trucks, leading to prolonged reliance on imported diesel and fiscal subsidies for the next 15-20 years.

Jude Lee, Regional Policy and Program Director of Asia-Pacific at T&E, said: “The Indonesian government has already recognised the importance of zero-emission technologies through the RUKN. The next step is a clear pathway toward 100% zero-emission truck sales by 2040. Without it, Indonesia risks becoming a dumping ground for outdated, inefficient, and highly polluting diesel trucks, while a strong sales mandate would attract investment, expand electric truck choices, and position Indonesia as Southeast Asia’s leading zero-emission freight market.”

The Java-Sumatra logistics corridor – accounting for nearly half of all national cargo activity – should be prioritized for early electric truck adoption and charging infrastructure expansion. Java alone drives 217 million tons/month of freight, concentrated in West and East Java’s consumer and industrial cargo. Meanwhile, Sumatra contributes 83.6 million tons/month of freight led by commodities like chemical and crude oil.

The highest concentration of emissions is found along the eastern segment of the Trans-Sumatra corridor (Jalan Raya Lintas Timur) and the Northern Coastal Route of Java (Pantura). Prioritising BEV trucks for these corridors could be supported by the installation of charging infrastructure along major national artery roads. In the Java-Sumatra corridor, 114 specific locations within 27 indicated areas have been identified for the deployment of 230 kW charging stations.

“The most practical starting point for truck electrification is in high-utilisation freight corridors where electric trucks already make economic sense. The Karawang Industrial Area – Patimban Port and Muara Enim corridors can become Indonesia's first zero-emission freight corridors, sending a clear signal that the country wants to attract electric truck investment rather than become a destination for outdated diesel technologies. These corridors can become the foundation of Indonesia's broader freight electrification transition,” concludes Jude Lee.