The Biodiesel Paradox: Analyzing the Multi-Dimensional Challenges of Indonesia's B50 Mandate Implementation

Indonesia's ambitious B50 biodiesel mandate represents the culmination of a progressive biofuel policy trajectory from B20 (2018) to B40 (2025), with the aim of achieving 50% palm oil biodiesel blending by 2026. While previous mandates demonstrated technical feasibility, the B50 target faces unprecedented multidimensional complexities that threaten its viability for implementation. This qualitative literature review synthesizes evidence from more than 80 sources published between 2020 and 2025 to identify and analyze thematic challenges confronting B50 implementation. Using thematic synthesis, this study examines production capacity constraints, technical compatibility issues, economic sustainability concerns, environmental paradoxes, and governance coordination gaps. Findings reveal critical bottlenecks: a production infrastructure deficit with only 3 of 5 required FAME plants under construction; feedstock supply uncertainty amid stagnating crude palm oil (CPO) production; vulnerability of the subsidy mechanism due to price inversion; technical material degradation in non-compatible engine systems; deforestation risks that contradict sustainability objectives; and fragmented, multi-ministerial coordination. The study concludes that direct B50 implementation in 2026 is not feasible given current constraints and recommends an intermediate B45 pathway that prioritizes diversified feedstock integration, with emphasis on palm oil mill effluent (POME) and used cooking oil (UCO), restructured financing mechanisms, and enhanced stakeholder coordination. This research contributes to understanding the complexity of renewable energy policy implementation in developing countries, highlighting the paradox whereby prior biodiesel success creates escalating challenges for subsequent ambitious targets. Policy implications emphasize adaptive governance, evidence-based phasing, and comprehensive sustainability frameworks to ensure effective implementation of the biofuel mandate.