Heaptalk, Jakarta — The Indonesian government is preparing three strategies to accelerate the country’s energy transition by reducing fossil fuel consumption. Purnomo Yusgiantoro, the president’s Special Energy Advisor, discussed these strategies during Bloomberg Technoz Ecofest 2024 (11/28).
The first strategy focuses on restructuring fuel subsidies. Purnomo outlined two options: Continuing the current subsidy scheme but refining it to target specific beneficiaries more accurately (quota system) and redirecting a portion of the fuel subsidy budget to direct cash assistance (BLT) for vulnerable groups.
Currently, fuel in Indonesia is categorized into subsidized and non-subsidized types. The large allocation for fuel subsidies constitutes a significant portion of the state budget (APBN). “For this reason, the government is exploring the second option, which involves reallocating some of the fuel subsidy funds to BLT programs,” Purnomo explained.
The second strategy involves diversifying energy sources to reduce fossil fuel dependence and promote the use of renewable energy (RE) in various sectors: Transportation, including EVs, biofuels, and gas-based fuels; households including electricity, electric stoves, gas pipelines, non-subsidized LPG, and rooftop solar panels (Solar PV); industry including electricity, gas-based fuels, and biofuels; and power generation including co-firing, phased retirement of coal-fired power plants, and expanded use of RE.
He emphasized, “Technology and the economic feasibility of alternative energy play critical roles in energy diversification.”
The third strategy to accelerate energy transition aims to encourage efficient energy use and reduce the percentage of energy consumption required to achieve economic output. According to the targets of the National Energy Conservation Master Plan (RIKEN), end-users could achieve significant energy savings: industry, 17% savings; transportation, 20% savings; households, 15% savings; and commercial buildings, 15% savings.
However, Purnomo stressed that public awareness is crucial for successful energy conservation. “Public participation is key to implementing energy conservation efforts,” he concluded.
