KONTAN.CO.ID - JAKARTA. Indonesia plans to run its maiden carbon trade next week, aiming to offer companies and financial institutions a mechanism to offset their emissions, while providing funding for carbon reduction projects, authorities said on Monday.

The Southeast Asian country is one of the world's top ten greenhouse-gas emitters, but has pledged to reach net carbon neutrality by 2060 and touted the planned carbon market as a way to fund climate solutions.

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"The launch of the carbon exchange will take place on Sept. 26, next week," Mahendra Siregar, head of the Financial Services Authority, told a seminar.

The government in the resource-rich country has previously said the market will trade carbon credit certificates issued for activities or projects that remove carbon from the atmosphere or companies that emit pollution below a limit set by the government.

The environment ministry has assigned four auditors to verify carbon reduction activities so that trading can start next week, Wahyu Marjaka, a director from the environment ministry, told the same seminar.

Authorities have yet to announce which exchange will host the trading, but the Indonesia Stock Exchange (IDX) has applied to become an operator earlier this month.

Jakarta in February launched the first phase of mandatory carbon trading for coal power plants.

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The government's initial plan was to set a pollution quota for each carbon-intensive industry and tax companies that emit above their limit without any carbon offset. But the tax plan has been shelved due to concern over its impact on economic growth.

Editor: Yudho Winarto