Biodiesel derived from palm oil has been recognized as a high-productivity oil crop among the first generation of biofuels. This study evaluated and discussed the net energy balance for biodiesel in Indonesia by calculating the net energy ratio (NER) and net energy production (NEP) form the total energy input and output. The results of the calculation of energy input for the default scenario demonstrated that the primary energy inputs in the biodiesel production lifecycle were the methanol feedstock, energy input during the biodiesel production process, and urea production. These three items amounted to 85% of the total energy input. Next, we considered and evaluated ways to potentially improve the energy balance by utilizing by-products and biogas from wastewater treatment in the palm oil mill. This result emphasized the importance of utilizing the biomass residue and by-products. Finally, we discussed the need to be aware of energy balance issues between countries when biofuels are transported internationally.