Indonesia Is Moving from Ambiguity to Architecture: MRAs, SRN Integration, and the Perpres Are Rewiring How Carbon Will Be Valued and Traded
For the past several years, Indonesia’s carbon market has been defined as much by uncertainty as by ambition. Questions around exportability, host-country approvals, voluntary standards, and registry requirements limited the ability of developers and investors to act with confidence. That phase is now ending. A sequence of coordinated moves over the last year — culminating in today’s Mutual Recognition Arrangement (MRA) signing with Verra — indicates that Indonesia has shifted from protective posturing to structured participation.
The agreement, announced on 2 October 2025 at the Four Seasons Jakarta in the presence of the Minister of Environment and Forestry and Verra’s CEO, is the clearest signal yet that Indonesia will not reject international standards but absorb them into its domestic system. Rather than attempting to replace Verra, ART TREES, Gold Standard or the Global Carbon Council, the government is choosing to regulate how they operate within its national framework. This is not a concession — it is a control strategy.
Crucially, today’s signing is not an isolated development. It is aligned with three parallel pillars: the acceleration of the SRN registry, the finalisation of carbon accounting rules, and the forthcoming Presidential Regulation (Perpres) that will anchor implementation. Combined with the commitments made at COP, these moves indicate that Indonesia is positioning itself to transact under Article 6, not observe from the sidelines.
From Exclusion Risk to Structured Recognition
For years, developers operating under international standards faced a foundational risk: would their credits be recognised by the Indonesian government, or later rejected as non-compliant with national rules? The Verra MRA removes that uncertainty but replaces it with new conditions. Projects using recognised methodologies will be able to operate, but only if they register through SRN and comply with host-country accounting and authorisation protocols.
This approach is expected to extend to ART TREES, Gold Standard and GCC. In practice, it means:
International methodologies will remain relevant.
National registry and oversight will determine eligibility.
Host-country approval will define export potential.
This transition mirrors similar developments in Brazil, Chile and Ghana, but Indonesia has gone further in codifying the pathway.
COP as Market Messaging, Not Diplomacy
At COP, Indonesian officials did not simply restate their NDC or reiterate interest in climate finance. They used the platform to signal readiness to transact with bilateral partners — including Singapore, the UAE, Japan and Switzerland — under Article 6. Commitments to finalise policy instruments and registry updates were made to an audience of investors and governments looking for certainty, not rhetoric. The MRA announced today is the first public confirmation that those commitments are being executed.
SRN Is Becoming the System, Not a Formality
The Sistem Registri Nasional (SRN) has existed for several years, but only in the past 12–18 months has it evolved from a passive record-keeping tool into a market infrastructure instrument. Government statements and technical updates indicate that SRN will now perform three essential functions:
Registration and attribution — All projects, including those under Verra and other standards, must register to be recognised.
Eligibility and allocation — The registry will determine whether credits count toward the Indonesian NDC or are eligible for export.
Tracking and adjustments — SRN will interface with Article 6 requirements, enabling corresponding adjustments and traceability.
For investors, this replaces speculation with a functional approval pathway. For developers, it makes registry integration a prerequisite rather than an afterthought.
The Perpres Will Codify What Happens Next
The forthcoming Presidential Regulation (Perpres) on carbon economic value is expected to embed these shifts in law. It will clarify:
How export and domestic use will be differentiated
Which ministries control approval and authorisation
How pricing and sectoral coverage are treated
How Article 6 transactions are validated and recorded
What conditions apply to finance, transfer and ownership
Once formalised, the Perpres will enable long-term offtake, blended finance and compliance-aligned contracting — all of which have been stalled pending legal clarity.
The Transition Is Structural, Not Incremental
The reason this moment differs from previous announcements is the convergence of four elements:
International standards are being integrated, not sidelined.
Registry and accounting are being linked to national and Article 6 rules.
The Perpres will provide enforceable legal grounding.
Investor-facing signalling at COP has been matched by execution on policy.
This is a governance model in formation, not a transition document.
What This Means for Developers
The implications for developers are direct. Projects using Verra or other recognised standards can participate, but only if they meet national conditions. That means:
Registering in SRN during project development, not post-issuance;
Aligning MRV systems with national accounting;
Planning early for host-country authorisation where export is intended.
Those that act now will secure the first wave of offtake and forward finance. Those that wait may be confined to domestic-only transactions with constrained pricing.
What This Means for Investors and Offtakers
For financiers, utilities, and corporate buyers, the effect is twofold. Uncertainty is being reduced, but access will depend on strategic alignment. The MRA with Verra lowers methodology risk, while SRN and the Perpres create predictable mechanisms for authorisation, ownership, and transfer. Investors can now begin structuring Article 6–compatible agreements, rather than discounting Indonesia as a high-risk jurisdiction.
Intermediaries Will Decide Who Can Participate
The model Indonesia is building cannot be navigated by developers or buyers acting alone. The complexity of registry processes, accounting rules, authorisation procedures, and due diligence requirements will require intermediaries able to operate across technical, financial and regulatory layers. This is no longer a brokering environment — it is a structuring environment, and that shifts who adds value.
Where Masdar Arche Fits
As Indonesia moves from broad policy statements to operational frameworks, success will depend on the ability to translate regulation into transactable projects. Masdar Arche operates in that gap — preparing developers for SRN registration and host-country approvals, structuring documentation to meet MRV, ESG, legal and financial requirements, and enabling investors to engage in Article 6–aligned transactions without navigating the policy landscape alone. In a system that is now integrating global standards through national control, alignment is not a differentiator — it is the entry point.
