Balancing Investment and Sustainability: Legal Challenges in Implementing the Domestic Market Obligation (DMO) in Indonesia’s Coal Sector
Keywords:
Investment, Sustainability, Domestic Market Obligation (DMO), Coal.Abstract
The Domestic Market Obligation (DMO) policy in Indonesia's coal sector has created tensions between domestic energy supply interests and a stable investment climate. Its implementation faces serious challenges, including regulatory inconsistency, price uncertainty, and the risk of legal conflicts. In addition, this policy is considered counterproductive to the energy transition agenda and national climate sustainability commitments. This study aims to analyze legal challenges and formulate alternative policies and legal recommendations in the implementation of DMO. This study uses a normative legal approach with a conceptual and legislative approach. Data are analyzed normatively and interpretively against primary, secondary, and tertiary legal materials. The results of the study indicate that the implementation of DMO has not been supported by stable and harmonious regulations with the principles of sustainability and investment protection. A more consistent legal framework, a clear energy transition mechanism, and strengthening of legal instruments are needed to ensure a balance between state interests and legal certainty for investors. DMO policy reform must be placed in the context of long-term energy transformation to align with Indonesia's sustainable development goals.
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