RENEWABLE ENERGY POLICY IN RENEWABLE ENERGY POLICY IN INDONESIAINDONESIA

Andi Novianto

Presented at APEC EGNRET MeetingHonolulu, March 29-April 3, 2009

Energy Mix Situation:Energy Mix Situation:

Oil

52,5%

Natural Gas

19,0%

Coal

21,5%

Hydro Power

3,7%

Geothermal

3,0% Other Renewable

Energy

0,2%

2

Industry is The Largest Consumption of Energy:Industry is The Largest Consumption of Energy:

Industry

47,9%

Household

12,8%

Commercial

4,0%

Others

4,7% Transportation

30,5%

3

PETROLEUM FUELS CONSUMPTION :PETROLEUM FUELS CONSUMPTION :

Industry21,9%

Household15,0%

Commercial1,7%

Electricity11,3%

Transportation50,0%

4

TARGET ENERGY MIX 2025TARGET ENERGY MIX 2025 : :

Natural Gas

30%

Geothermal

5%

Other Renewable

Energy

5%Biofuel

5%

Coal Liquefaction

2%

Coal

33%

Oil

20%

5

6

- Population Increase:

- Increase in Economic Growth:

- Increase in Living Standard

- Population Increase:

- Increase in Economic Growth:

- Increase in Living Standard

- Energy Demand Increase

- Electricity Demand Increase

- Energy Demand Increase

- Electricity Demand Increase

Environmental Issue:- Global Warming- Air Pollution- Acid Rain- Health

Environmental Issue:- Global Warming- Air Pollution- Acid Rain- Health

TYPE OF ENERGY SELECTION

Fosil Energy

OIL COAL Gas

NEW AND RENEWABLE ENERGY

Hiydro,Microhydr

o

Solar, wind, biofuel,

geothermal, hidrogen, FC

Nuclear

Environment INFRASTRUCTUR ENERGY RESOURCES SOCIAL-CULTURE GEOPOLITIC ECONOMY

BASED ON NATURAL RESOURCES BASED ON TECHNOLOGY

NATIONAL ENERGY PLANNING to 2025:NATIONAL ENERGY PLANNING to 2025:

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Economic Activity Economic Activity

National Security

National Security

EN

ER

GY

RO

LE

EN

ER

GY

SEC

UR

ITY

PRODUCTION/EXPLORATION

PRODUCTION/CONSERVATION

DIRECT SUBSIDY

DIVERSIFICATION

CONSERVATION (EFFICIENCY)

SUPPLY POLICY

DEMAND POLICY

SUPPLYGUARANTEE

PEOPLE’SAWARENESS

ENERGY PRICE

SH

IFT

ING

P

AR

AD

IGM

ENERGY POLICY FRAMEWORK:

RENEWABLE ENERGYRENEWABLE ENERGY POTENCY: POTENCY:

NON FOSSIL ENERGY

RESOURCES UTILITY CAPACITY

Hydro Power 75,670 MW 4,200 MW

Geothermal 27,000 MW 1,042 MW

Mycro Hydro 450 MW 210 MW

Biomass 49,810 MW 445 MW

Solar Energy 4,80 kWh/m2/day 12 MW

Wind Energy 3-6 m/second 2 MW

9

New and Renewable Energy Development New and Renewable Energy Development

Short & Medium Term : - Small scale for fulfilling basic energy need for rural area

- Intensification use of hydro, geothermal, solar and win energy for electricity generation

- Development of Biofuel

Long Term : - Development of new energy (fuel cells, hydrogen)- Development of Nuclear Energy- Development of Unconventional energy sources

(tar/oil sand, biogenic gas, etc)

In the year 2025 : At least 15% of the energy mix should be based on renewable energy (Presidential Decree 5/2006)

TARGET:TARGET:

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RENEWABLE ENERGY RENEWABLE ENERGY DEVELOPMENTDEVELOPMENT1. Electricity generation

◦ Generated from new renewable energy sources such as microhydro, solar, wind, biomass;

◦ Priority for diesel fuel substitution for electricity generation in rural area and for rural electrification

2. Fuel◦ Currently, it is generated from biomass;◦ Priority for petroleum-based fuel substitution in

transportation sector and kerosene substitution in household sector

3. Thermal/mechanical energy uses◦ Can be generated from mostly renewable energy

sources;◦ Current applications are for agricultural food

processing, water pumping;◦ Technologies are suitable for rural implementation.

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1. Program on Rural Electrification : to provide access on electrification for rural communities; since 2005 the government has been decided not to utilize diesel genset and only to implement locally available renewable energy (if the extension of grid is impossible).

2. Program on Interconnention of Renewable Energy Power Generation : as an innitiative for investor to develop small/medium scale power generation from renewable energy to sell of electricity to PLN (state electricity company) with standardized price following government regulation.

3. Integrated Microhydro Development Program (IMIDAP) : a hibah from GEF through UNDP for 2007-2012 to acclerate microhydro implementation by removing existing barriers.

4. Micro Hydro Power Program (MHPP) : technical cooperation with Germany through GTZ to develop capacities on technology and sustainability of microhydro implementation.

RENEWABLE ENERGY PROGRAMRENEWABLE ENERGY PROGRAM (1) (1)

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5. Program on Urban Solar : launched in 2003 to support solar photovoltaic implementation in urban society. The results are not significant yet

6. Program on Biogas : launched in January 2008 in cooperation with Dutch government; consists of technical assistance and financing mechanism development system.

7. Program on Energy Self-Sufficient Village : launched in 2007 to improve energy security on village level by diversifying rural energy mix; developing locally available renewable energy sources in the form of fuel (biofuel) and electricity for household and also productive end uses.

8. Program on regulation preparation : as mandated by Energy Law.

Renewable Energy Renewable Energy Program (Program (22))

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☼☼ Self-sufficient Energy Village (SSEV) ProgramSelf-sufficient Energy Village (SSEV) Program

SSEV is a village having capability to produce a part/whole their energy demand for consumptive and productive use.

CRITERIA− Utilization of locally available energy (renewable energy)− Creation of productive activities− Job creation

PROGRAM:– Utilization of locally available energy resources– Development of productive activities– Development of applicable technologies– Development of institution and people participatory

ELECTRICITY OBJECTIVES:

INCREASE ELECTRIFICATION IN HOUSEHOLD SECTORS (RURAL - URBAN) AND INDUSTRY IN EFFICIENT AND ENVIRONMENTAL WAYS TO SUPPORT ECONOMIC GROWTH AND PEOPLES’ WELFARE.

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ELECTRIFICATION RATIO NAD72,65%NAD

72,65%

Sumut85.76%Sumut85.76%

Sumbar68.75%Sumbar68.75%

Riau + Kepri63.15%

Riau + Kepri63.15%

Sumsel50.75%Sumsel50.75%

Bengkulu50.64%

Bengkulu50.64%

Babel69.27%Babel

69.27%

Lampung49.23%

Lampung49.23%

Jakarta100%

Jakarta100%

Banten58.44%Banten58.44%

Jabar63.40%Jabar

63.40% Jateng63.77%Jateng63.77%

Jambi47.03%Jambi47.03%

Jogya74.37%Jogya74.37%

Jatim63.67%Jatim

63.67%

Bali78.37%

Bali78.37%

NTB30.48%

NTB30.48%

NTT26.35%

NTT26.35%

Kalbar53.74

%

Kalbar53.74

%

Kalteng49.87%Kalteng49.87%

Kalsel67.38%Kalsel67.38%

Kaltim66%

Kaltim66%

Sulut61.84%Sulut

61.84%

Gorontalo43.31%

Gorontalo43.31%

Sulteng51%

Sulteng51%

Sultra43.88%Sultra

43.88%

Sulsel60.81%Sulsel60.81%

Malut54.15%Malut

54.15%

Maluku58.06%Maluku58.06%

Papua + Irjabar35.35%

Papua + Irjabar35.35%

Rasio Elektrifikasi : 63.9%Year

1980 1985 1990 1995 2000 2005 2006 2007 2008Electrification Ratio 8% 16% 28% 43% 53% 62% 63% 64 % 64.5

Category :Category :

> 60 %

41 - 60 %

20 - 40 %

ELECTRICITY SOURCES:

ELECTRICITY UTILIZATION SHARE:

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ELECTRICITY SYSTEM :

Power Generator Transmission

Grid Users

SALES TARGET BY PLN-2008 (TWh) :

41%

17%

36%

6%

Household Commercial Industry Public

ELECTRICITY BY REGION :

80%

20%

JAWA-MADURA-BALI OUTSIDE Jawa-Madura-Bali

GOVERNMENT SUBSIDY :

0

20

40

60

80

100

120

140

160Rp.

Tri

llion

2005 2006 2007 2008

Electricity Fuel/LPG

SUPPORT POLICY TO RENEWABLE ENERGI:

Non Fiscal Incentives through Regulation.

Support Small-Medium Scale Power Connection Program at Medium and Low Grid.

Non Uniform Tariff, based on Region, Peoples’ Capability, and Sources.