Rubicon Carbon, a company backed by TPG Inc.’s Rise Climate fund, will help finance carbon credit projects in Indonesia as the country pushes to expand supply and forge trading agreements with other nations.
Rubicon Carbon and the Ministry of Marine Affairs and Fisheries of the Republic of Indonesia (KKP) signed a Letter of Intent to advance strategic collaboration on blue carbon development in Indonesia.
Indonesia’s government has established a co-investment partnership with Rubicon Carbon that will pool public and private capital for blue carbon deals through a dedicated vehicle, Marine Affairs and Fisheries Minister Sakti Wahyu Trenggono said in a statement to Bloomberg News.
“Indonesia is committed to unlocking the full potential of its blue carbon economy while ensuring that coastal communities remain at the centre of its development,” Trenggono said.
Blue carbon projects generally involve the capture of carbon dioxide by coastal ecosystems such as mangroves and salt marshes.
Under the arrangement, Indonesia’s government will provide support through land access, permitting, and help engaging local communities.
No financial terms were disclosed, and a Rubicon Carbon spokesperson declined to discuss specifics of the co-investment deal. Trenggono added that the partnership’s initial phase — expected to become Indonesia’s largest blue carbon mangrove restoration effort — will span as much as 70,000 hectares (172,974 acres) along Java’s northern coast, with room to grow if the pilot phase proves successful.
President Prabowo Subianto has previously outlined a goal of generating billions of dollars in revenue from carbon credits and has moved to revive the sector through various policy measures.
Indonesia was once among Asia’s top suppliers of voluntary carbon credits before it restricted exports in 2022, when the prior administration reassessed how domestic offsets fit into the country’s own climate targets.
Rubicon Carbon, led by former Bank of America Corp. executive Tom Montag, was founded to capitalize on an expected surge in carbon markets driven by intensifying climate concerns. While proponents view the market as essential to achieving global net-zero goals, it has lost momentum in recent years following a series of scandals and companies pulling back on emissions commitments.
“Indonesia has an extraordinary opportunity to become a global leader in blue carbon,” Montag said in a LinkedIn post on Rubicon Carbon’s account last month.
