Lampung Eyes Carbon Trading to Drive Green Economy

RRI.CO.ID, Bandar Lampung - Sumatra’s southernmost province of Lampung is positioning itself as a strategic player in Indonesia's green economy transition, capitalizing on its vast conservation areas and diverse agroforestry to spearhead carbon-trading initiatives.

Rather than viewing climate action merely as a conservation obligation, the region is framing its significant carbon sequestration capacity as a major economic driver capable of drawing green investments and creating sustainable jobs.

According to the Finance Ministry’s Directorate General of Treasury (DJPb) Lampung Regional Office, the province boasts a massive carbon potential estimated at 21 million to 39 million tons of carbon dioxide equivalent (tCO2e) per year. This immense volume is derived from its expansive forested areas, coastal mangrove ecosystems, extensive plantations of productive crops like coffee, cocoa, and rubber, as well as optimized waste management systems.

"Lampung Province has great potential to play a role in developing carbon trading and developing a green economy," Head of the DJPb Lampung Regional Office, Purwadhi Adhiputranto, said in a statement on Monday, July 6, 2026, as quoted by Antara.

He noted that local communities actively participating in social forestry programs, combined with the province’s strategic geographic location, further reinforce this potential.

"Not only that, there is also support from local communities active in social forestry programs and a strategic location. Thus, the development of carbon trading opens up green investment opportunities capable of driving the economy through job creation, improving the welfare of communities around conservation areas, and strengthening competitiveness," he added.

To realize this vision, the central government is leveraging the state budget (APBN) to finance environmental rehabilitation programs, improve local governance, and build the capacity of regional administrations to implement green policies.

"Carbon trading is becoming a new opportunity toward Lampung's green economy. In addition to maintaining short-term economic stability, the government also continues to prepare the foundation for more sustainable long-term economic growth. One of them is through the development of carbon trading, which is starting to become an important part of Indonesia's green economy transformation," Purwadhi explained.

According to him, the growing focus on carbon dynamics has successfully encouraged all stakeholders to take a more active role in maintaining ecosystem balance and conserving the environment.

Lampung's readiness for carbon trading is backed by its track record. The province was previously designated as a pilot region for calculating the economic value of carbon derived from social forestry.

This is due to its diverse community-based forest management models, including Community Forests (HKm), Village Forests (HD), and People’s Plantation Forests (HTR), all of which possess high capacity for carbon absorption and storage.

In 2025, the province received an allocation of IDR 7.6 billion (USD 472,173) for forestry activities from the Environmental Fund Management Agency (BPDLH).

Furthermore, the famous Way Kambas National Park in East Lampung has been selected as a pilot project for the implementation of innovative climate financing. These mechanisms include biodiversity bonds, carbon credits via international voluntary carbon markets, and the strengthening of conservation tourism, or ecotourism, designed to attract various visitor segments.

The development of these initiatives will rely on a blended finance system, a funding mechanism that goes beyond the state budget and international NGO grants to actively involve private sector players who hold a high commitment to conservation. ***