Green Finance Company Incentives in UU DKJ

Law No. 2 of 2024 on the Special Region of Jakarta Province, as amended by Law No. 151 of 2024 (collectively referred to as “UU 2/2024”) plans to realize nature-based and environmental plans through green financing (green fund).

Director of Air Quality Protection and Management of the Ministry of Environment, Edward Nixon Pakpahan said the form of green financing cooperation could be in the form of rewards to companies.

“Later, incentives and disincentives will be regulated. What form of incentives? If the government cannot provide direct money, then provide access, maybe tax reductions, and support for banking access,” Edward told Hukumonline.

On the other hand, for corporations that violate financing provisions, disincentives can be given in the form of fines. “The fine reduces the economic cash flow, plus the bad reputation (of the company),” Nixon continued.

This policy can be regulated in derivative regulations of the law. In line with the government's plan to encourage Jakarta as an area to accelerate the realization of green investment, so that it can be an example for other provinces.