Energy in Indonesia
[14] 2012R = CO2 calculation criteria changed, numbers updated According to the IEA, energy production increased 34% and export 76% from 2004 to 2008 in Indonesia.
Renewable energy sources also added to the mix, with biofuels and waste accounting for 13.8%, wind and solar providing 11.6%, and hydro contributing 0.9%.
The country's coal production surged to a record 679 million short tons in 2019, a 12% increase from the previous year.
However, due to a reduction in domestic demand in 2020, the Indonesian Coal Mining Association requested a temporary suspension of the DMO.
The country has been focusing on increasing exploration and production, which grew by approximately 105% from 2010 to 2020, driven by robust demand in Asia.
[19][21] In terms of environmental goals, Perusahaan Listrik Negara (PLN), the state electricity company, has plans to phase out coal-powered plants by 2056 to achieve carbon neutrality.
According to one Greenpeace report, a coal plant in Indonesia has decreased the fishing catches and increased the respiratory-related diseases.
Since 2000, domestic consumption has continued to rise while production has been falling, so in recent years Indonesia has begun importing increasing amounts of oil.
Chevron Pacific Indonesia and NuEnergy Gas are also pioneers in using fracking in existing oil fields and in new exploration.
Environmental concerns and a government-imposed cap on oil prices present barriers to full development of the substantial shale deposits in the country.
With low enthusiasm to develop CBM project, partly in relation to environmental concern regarding emissions of greenhouse gases and contamination of water in the extraction process, the government targeted 8.9 million cu ft (250 thousand m3) per day at standard pressure for 2015.
One policy requires private investors to transfer their projects to PLN (the sole electricity off-taker in the country) at the end of agreement periods, which, combined with the fact that the Minister for Energy and Mineral Resources sets the consumer price of energy, has led to concern about return on investment.
Another issue is related to financing, as to achieve the 23% renewable energy target, it has been estimated that Indonesia needs to invest US$154 billion.
[57] Continued reliance on fossil fuels by Indonesia may leave its coal assets stranded and result in significant investments lost as renewable energy is rapidly becoming cost-efficient worldwide.
[59] An estimated 55% of Indonesia's population, 128 million people, primarily rely upon traditional biomass (mainly wood) for cooking.
A pilot project of Palm Oil Mill Effluent (POME) Power Generator with the capacity of 1 Megawatt has been inaugurated in September 2014.
[54][62] Currently, only 34GW of Indonesia's total hydro potential can feasibly be utilized due to high development costs in certain areas.
Expansion appears to be held up by a range of technical, economic, and policy issues which have attracted considerable comment in Indonesia.
[77] However, a lack of consistent and supportive policies, the absence of attractive tariff and incentives, as well as concerns about on-grid readiness pose barriers to the rapid installation of solar power in Indonesia, including in rural areas.
The Alas Strait, a 50km stretch of ocean between Lombok and Sumbawa Island, alone could potentially yield 640 GWh of energy annually from tidal power.
There is therefore an urgent need for policy reform and infrastructure investment to enhance the energy efficiency of transport, particularly in urban areas.
Both would require comprehensive supply chain analysis to ensure that the biofuels and power plants are not having wider environmental impacts such as deforestation or air pollution.
[83] The electricity sector in Indonesia, managed primarily by the state-owned enterprise Perusahaan Listrik Negara (PLN), faces significant challenges due to the country's archipelagic nature, which includes over 17,000 islands.
By 2020, Indonesia had installed approximately 63.3 gigawatts (GW) of electrical generation capacity, producing around 275 terawatt-hours (TWh) annually, predominantly from fossil fuels such as coal, natural gas, and oil, alongside contributions from renewable sources like hydroelectric and geothermal power to align with the Paris Climate Agreement's goal of increasing renewable energy to at least 23% by 2025.
[89][88] Indonesia's Ministry of Energy and Mineral Resources (MEMR) is advancing bioenergy utilization with initiatives like setting up waste-to-energy plants in 12 cities, implementing co-firing in coal generators, and increasing the use of liquid biofuels.
The government intends to further raise biodiesel blending to 40% (B40) and supports the construction of refineries to transform waste bioenergy into biofuels, including bio-based liquefied petroleum gas (LPG) and naphtha.
