Being a tropical country with around 17,000 islands, Indonesia has challenges and advantages of its own in managing the supply and distribution of energy to the citizens of this vast country.
With total population of around 261.1 million, mostly lives in the dense Java, Bali, and less dense Sumatera, then in the rest of the other islands, urban population have reached 142.2 million. Today, Indonesia is the world’s fourth most populous nation, the world’s 10th largest economy in terms of purchasing power parity. Indonesia has made enormous gains in poverty reduction by cutting the poverty rate to more than half since 1999, to 10.9% in 2016.
Distributing the supply of energy in its varied forms, in Indonesia is a real logistic problem. To overcome this problem, since this last decade especially in the last 4 years, government of Indonesia is actively building the infrastructure: the toll roads, the airports and seaports and cleaning up some investment difficulties and stigmas, such as: corruptions, collusion and nepotism, reducing unnecessary rules and regulations, creating new and transparent regulations to attract more investors in energy in general as well as in renewables.
Indonesia had had experience as oil and gas producing country started from 1967, and the peak production was around 1.7 Million Barrel Oil Equivalent per Day in 1977. Since 1994, the production was gradually declined and Indonesia became net importer in 2004. In 2016, the production of crude oil and gas were 268,877.25 Thousand Barrel (around 737,000 BOPD) of crude oil, and 3,070.24 BSCF (around 8,400 MMSCFD) of associated and non-associated Natural Gas. In 2016, the oil reserves (total proven and potential) was 7.25 billion Barrel, and the natural gas reserves was 144.06 TSCF (the total proven and potential reseves). Assuming those numbers are total recoverable reserves and the rate of production is constant assuming also no additional reserves from exploration and no future technology that can increase the recoverable reserves, and the total recoverable reserves only 50% of the those calculated reserves, so we may estimate the remaining production only 13 years for crude oil (Year 2029), and 25 years for Natural Gas (Year 2051).
The coal reserves of Indonesia is about 2.2 % of the world proven reserves. The total reserves of coal recorded in December 2016 was 28,457.29 million Ton, and the total production was 456,197.775 Ton annually. Assuming similar assumption for simple calculation, then the R/P of coal is 62 years (until Y2078).
In 2017, Indonesia was rank 15thof 16 countries which was listed in President Trump’s Executive Order that has imbalance import. The import from US to Indonesia was only 1 % of the export from Indonesia to US. US experienced US$ 13.2 billion trade deficit with Indonesia in 2016. In 2018, Indonesia has trade import deficit also, because some countries reduce the import from Indonesia. Therefore, putting additional pressure on the Rupiah exchange rate, made the current account deficit to Indonesia in 2018, mainly because the increase of import and price of fuels for domestic purposes. To reduce the increasing of USD expenses, Indonesia then accelerate as mandatory to replace the Diesel Fuels with Biodiesel B20 in Indonesia. This situation pushed the Government of Indonesia to take a look to use renewables more intensely in Indonesia.
Indonesia has abundant of Renewables: Hydro Power, Geothermal, Biomass, Solar and Wind, and Wave, OTEC, and Tidal Ocean Energy. Potential energy from renewables is 443.2 GW and just to be utilized by 8.9 GW or only around 2 % of the total potential.
|Renewable Energy Source||Potential Energy|
|Hydro Power, Mini and Micro Hydro||75 GW|
|Wind Power||60.6 GW|
|Ocean Power||17.9 GW|
The government has issued The General Plan on National Energy or RUEN in 2017, with the energy policy focus on 5 pillars:
1. Increase of electrification ratio
2. Fair distribution on equality & affordability
4. Conducive investment and economic growth
5. Good governance and streamlining bureaucracy and licensing
RUEN as a plan, is a good indeed, however it needs to track and manage it, change it as necessary as we manage a project.
1. Indonesia has abundant of fossil fuels and renewable energy resources, however due to economic development, increasing population, and decreasing crude oil and gas production than a gap between supply and demand of the energy especially fossil fuels in Indonesia is becoming deeper.
2. As a country which has many energy resources, Indonesia has very limited research in energy industry. Even, Indonesia has no industry that produce solar cell, while the surrounded countries has this industry. The research in solar cell and other renewables shall be taken, beside other researches.
3. Natural gas and biofuels will gradually replace the roles of liquid conventional fuels; mitigation of methane emission shall be considered.
4. The use of B20 shall be extended to more contents of biofuels. Higher standards biofuels in big number shall be produced to cover the demand, probably Indonesia needs to build some biofuel refineries.
5. The Government of Indonesia shall be supported to improve the business environment on industry investment, especially on Renewable Energy Industry which is more sustainable and environment friendly.