Gas Emission Long Road

The desire of the The ministry of environmental to made a regulation regarding the heavy
equipment gas emission Must be appreciated eventhough the bussiness perpetrators Refuse
against such policy.

Rules which has been discussed since the year 2013, until now still has not yet been resolved,
Nevertheless the ministry of environment optimistic that the policy which will be in the form
of minister regulation can be resolved this year and will be imposed in 2016 with considering
the preparedness of the national industry.

For the government, the presence of regulations pertaining to the emission of a heavy
equipment considered quite urgent because the development tend to spur the rate of the fleet
addition of heavy equipment. Until now the ministry of environment estimated the needs of
heavy equipment in Indonesia reach 13,000 units per year, about 10,000 units are domestic
production, while the rest come from imports from Germany, Japan, and China.

Other concerns, without the gas emissions regulation, the ministry of environmental is having
dificulty to limit the flood of recondition and used heavy equipment. With these conditions, it
was feared that the government will difficult to control the level of those heavy equipment
gas emissions.

Based on official statement from the ministry of environment , currently fuel dominant be
used in the operation of heavy equipment containing high sulfur or more than 5000 part per
million (PPM). However the noble intentions of the ministry of environmental not
accordance with the fact, after discussion in June, there is no sign that the policy will be soon
completed.

The deputy minister of environmental pollution control from ministry of environment

Karliansyah, said the new policy will control air pollution from exhaust gas emissions of
heavy equipment. He said that until now there is still many used heavy equipment that
operates, those heavy equipment makes indonesia the disposal of used heavy equipment
which is not suitable to be used.

According to Karliansyah, for the policy regarding the new type heavy equipment, the
ministry of enviroment stated that they still try to complete the academic script. Having
finished, they will invite the association of heavy equipment, the ministry of trade, the
ministry of industry, and customs to the discussion of the policy draft.

From the the draft that Bisnis Newspaper received regarding the new type heavy equipment
which are consist of 12 chapters and 22 article. The draft which is still have plenty of revision
basically will regulate gas emissions espesially for the heavy equipment product with a
certain standart.
Basic standard which shall be stipulated reportedly will refer to the euro II standard / tier II,
And the quality standard tests to be done by national accreditation committee appointed by
the ministry of environment to conduct laboratory tests.

This is confirmed by Corporate Communication and CSR Manager of PT Trakindo Utama,

Sheila Kansil, which states that previously heavy equipment business operators has heard the
government plan to implement emission standards comparable to the EU stage II (euroII) or
tier 2 of Environmental Protection Agency (the environmental protection agency of United
States). However, according to sheila, until now, there is no clear information of the
implimentation.

From the information obtained by a Bisnis newspaper in June 2014, preliminary policies draft
regarding the emission had jointly discussed between the ministry of the environment and
industry perpetrators. The ministry of environmental considers that the implementation of
policies regarding emission have to review the readiness of the needs of local heavy
equipment producers as well as the needs of imports.

According to Sheila, Trakindo as one of the main player in the heavy equipment vehicle
sector continue to monitor the developments of the emission policy. She said, By the
presence of the gas emissions regulation, all business players will feel its impact.

She said that the consequences, certainly business players needed time until several years to
implement the regulation in full. At the other side, Sheila mentioned that from all kind of
types of heavy equipment product of the Caterpillar, since 2001 there have been electronic
machine technology as a transition from a standard tier 1 to tier 2. Technology provide better
fuel savings compared with the previous type of machine formerly.

Moreover, she said that the government can refer Economic Comittion for Europe (ECU)
R96 regulations that is the euro emission standards for heavy equipment machines.

One of the member of Indonesia Heavy Equipment Sole Agen Association (PAABI) whic is
Gaya Makmur Tractors (GM Tractors), estimate that the rules are not in accordance with
heavy equipment market conditions at this time.

According to Marcom Manager of GM Tractors, Fahrudin, around 75% of the heavy

equipment operated and marketed currently still use conventional machine, of course not
adhering to the euro 2 standard.

With the mentioned constraints, if consumers of heavy equipment impose the use the euro 2
standard machine, according to Fahrudin, they will be difficulties due to the machine
breakdown.

He argued that if Euro 2 engine forced to use the low quality fuel diesel could cause the
engine more easily to breakdown, at least a filter machine will be broken.

Hereby bellow are the resume of the draft heavy equipment gas emission:
1. The policies is aimed at providing guidelines on the control of exhaust heavy
equipment gas emission and a new type of supporting industry activity.
2. Any heavy equipment and new type industry supporting instrument is obliged to
meet the emission quality standard of heavy equipment and new type industry
supporting instrument.
3. Heavy equipment and new type industry supporting instrument that is impor into
Indonesia which is brand new should be equipped with:
a. A copy of a certificate of the test results issued by accredited laboratory.
b. A copy of the certificate laboratory as a laboratory that is accredited
c. A copy of the protocol test cycle
d. Details about the specifications of reference fuel used.
e. Met the administrative and technical requirements that have been verified by
the authorized institution.