Biomass Energy Expansion at the Expense of Indonesia’s Gorontalo Forests

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Marihel Parda Winda

Amalya Reza

TrendAsia

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Gorontalo Province, located in the Wallacea biodiversity hotspot on the island of Sulawesi, Indonesia, is increasingly becoming a centre of industrial woody biomass production. Driven by domestic energy policies and growing international demand for wood pellets, particularly from Japan and South Korea, the expansion of energy plantation forests (Hutan Tanaman Energi, HTE) is placing increasing pressure on natural forests, biodiversity, ecosystem services, and the rights and livelihoods of Indigenous Peoples and Local Communities (IPLCs).

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Key findings

Biomass plantations are expanding into Gorontalo’s forests.
Ten energy plantation concessions spanning more than 265,000 hectares, with 9,617 hectares of deforestation recorded inside 4 active concessions during 2020–2026, about 18% of the forest they contained in 2020, with 44,685 hectares of forest still at risk. In the PT Banyan Tumbuh Lestari alone, 42% of the forest has been lost, with another 720 hectares identified in January–April 2026.
Forest conversion threatens exceptional biodiversity and sensitive watersheds.
Gorontalo lies within the Wallacea biodiversity hotspot, and about 28% of the concessions area (75,412 hectares) overlaps Key Biodiversity Areas and 59,623 hectares of Important Bird Areas. Some concessions also lie upstream of flood-prone communities in Pohuwato, where clearing may aggravate runoff and erosion.
Communities face mounting landrights concerns.
Concessions linked to the PT Gorontalo Panel Lestari pellet supply chain contain more than 24,500 hectares of tropical
rainforest, in areas that overlap the territory of the Indigenous Polahi People. In Pohuwato, disputes over plantation benefit obligations have been accompanied by reported detentions and criminalisation.
Japanese and South Korean demand is driving the expansion of Indonesia’s pellet industry.
In 2024, exports to these two countries accounted for more than 98% of Indonesia’s reported wood pellet production, demonstrating the industry’s overwhelming dependence on these markets. Between 2021 and 2025, Japan’s wood pellet imports from Indonesia increased from 28,000 to 405,000 tonnes, while South Korea’s nearly tripled from 315,000 to 898,000 tonnes. Japanese trading company Hanwa holds a reported 20% stake in PT Biomasa Jaya Abadi, a major pellet producer in Gorontalo.
Policy reforms have yet to close major safeguards gaps.
Existing demand for wood pellets continues, despite South Korea scaling back some biomass subsidies, and Japan introducing lifecycle emissions requirements in April 2026. Meanwhile legality checks, certifications and corporate site visits do not necessarily prevent forest conversion or ensure meaningful consultation with affected communities