Sustainable Energy Transition Development in Indonesia

1. Sustainable Energy Transition Development:
Research Agenda
Anjar Priandoyo
PhD Candidate – Environment Dept. University of York
Confidential
Jakarta, 17 October 2016

2. Indonesia Transition 700-2000
700 800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000 2100
Portuguese
1512-1575
Dutch
1602-1942
British
1811-1816
Japanese
1942-1945
Indonesia
1945
IslamHindu Buddha
The history of Indonesia is the history of exploitation of natural resources

3. Development: A Paradox of Plenty
5th largest
exporter of
Natural Gas
1st largest
exporter of
Coal
40% world
Geothermal
Reserves
2nd largest
Palm Oil,
Cacao, Rubber
Exporter
3rd largest
Tropical Forest
(60% of
country’s land)
2nd largest Tin
Producer
4th largest
Nickel
Reserves
4th largest
Bauxite
Producer
110th Human
Development
Index (0.68)
117th GDP per
Capita
($3,500)
107th
Corruption
Index
4th largest
population
(250 mill)
1.2%
Population
Growth
16th largest
economy
($800 bill)
6% Economic
Growth
15th largest
energy cons.
(200 Mtoe)
4.1% Energy
Consumption
Growth
73th Energy
Sustain. Index
WEC, IEA 30th
Low Energy p.
cap. 800 Kgoe
Rank 104th
Low Electrify
(80%)
Rank 108th
Low Renewbl
(8%)
Rank 30th
112th
Environment
Index (EPI)
8th largest
GHG emitter
800 Mt CO2e
20th worst
pollution
WHO 102 PM
Question 1: What is the characteristics of energy
development in Indonesia?
Environment
Policy
Energy
Policy
Indonesia, a paradox of plenty
3

4. Sustainability: Energy and Environment Link
Energy Development
Index (IEA)
Household
Indicator
Community
Indicator
Share of Population
with electricity access
80% & per cap.
residential electricity
consumption 620Kwh
Share of modern
fuels within
residential sector
Per-capita public
electricity
consumption
Share of Productive
uses in total final
consumption
Environment Burden
Disease (WHO)
Indoor Air Outdoor Air
Solid Fuel Use%
Households 72%
45,300 death/year
Mean Urban PM 10
114 ug/m3
32,300 death/year
Energy Mix
Scenario ???
Coal Oil Gas Renewable
Industry Household Transportation Other
Question 3: What is the lowest impact
energy scenario
Based on
Source
Based on
Sector
??????
Based on
Transition
Strategy
Energy Stack
(Parallel)
Energy Ladder
(Sequential)
Improve Energy Access
Reduce Air Pollution
Avoid Dangerous GHG
Improve Energy Security
Question 2: What is the link between
energy and air pollution
4

5. Why this is Important?
“…Energy transformation is
needed to address the growing
risks associated with accelerated
environmental change.
Emissions from energy use
contribute to multiple impacts
on social and environmental
systems in complex ways that are
not always well understood…”
Global Energy Assessment, 2012
Energy always become main political issues in
Indonesia from fuel conversion (2007, 50 mill
population), fuel subsidize (2014, 2.6% GDP),
electrification (2015, 80%), renewable (2011,
8%)
Decision making on which energy policy that
should be implemented is difficult, even
conflicting (Mujiyanto and Tiess, 2013),
(Gunningham, 2013), for example
Greenhouse Gas Reduction vs 35,000 MW
Power Plant Development
Inaccuracy of measuring the impact and
potential of energy (Purwanto et al., 2015)
including lack of study on energy industry
implication to air pollution (Shrestha and O.P.
Marpaung, 2002), (Spracklen et al., 2015)
5
1. What is the characteristic of energy
development in Indonesia?
What is the characteristic of energy
consumption and energy supply? What is
the characteristic of pollutant in
Indonesia? What is the potential
emission reduction that can be made
between energy conservation and energy
diversification policy?
2. What is the impact of energy
development to air pollution in
Indonesia?
What is the impact of air pollution for
human health? What is the impact of
specific pollutant for human health and
environment?
3. What is the best energy scenario that
has the lowest impact to the air
pollution in Indonesia?

6. High Level Research Interaction
6
Country Sector Pollutants Impact PolicyCurrent State
Emission
Inventory
Supply Demand
Scenario
Emission Scenario Impact PolicyResearch Structure
Energy Mix Pollutants ImpactResearch Question
Supply & Demand
Model (LEAP)
Emission Inventory
Model (GAP)
Methodology
Scenario Analysis
Non Energy SectorEnergy Sector
Sustainable Energy
Developing
Country
Background Public HealthEnergy Transition
Environment &
Energy

7. Energy Transition
• Transition is the process of changes that can be defined as major changes
in the way society works. Transition do not only involve changes in
technology, but also changes in user practices, regulation, industrial
networks (Geels, 2002)
• Energy transition defined differently by various researcher (Sovacool,
2016). For example the energy transition can be defined as:
– Energy mix transition. A change in fuels (from wood to coal or coal to oil) and
their associated technologies (from steam engines to internal combustion
engines). (Hirsh and Jones)
– Energy balance transition. The switch from an economic system dependent on
one or a series of energy sources and technologies to another (from import
dependent country to exporting country) (Fouquet and Pearson)
– Energy pattern transition. A particularly significant set of changes to the
patterns of energy use in a society, potentially affecting resources, carriers,
converters, and services. (O’Connor)

8. Energy Transition in Indonesia
• In Indonesia, energy transition and various factor that affecting transition
have been identified by various researchers in several period such as
• 2000 period, Kerosene to LPG conversion (Sovacool, 2016), an energy mix
transition.
• 2000 period, Private power development (Wells, 2007). Globalization led
to Indonesia’s electricity market liberalization, an energy market transition
from government owned to privatization.
• 2010 period, Low carbon growth to reduce GHG (Schwarz, 2010), an
energy pattern transition, including the change in environmental
expenditure (Vincent et al., 2002)

9. Energy Mix in Indonesia 1900-2010
Energy mix is the composition of fuel source. The energy transition in Indonesia is rapidly happen, compare with
other developing countries (Bee, 1984)

10. Historical Energy Growth 1980-2014
• Fourth most populated country in the
world with more than 250 million
citizens, average 1.2% population
growth.
• Energy growth from period of 1980 to
2014 Indonesia is estimated to be 5-7%
per year.
• Energy consumption around 200 MTOE
in 2014 and estimated to be 400 MTOE in
2030
• Energy transition can be seen from
energy mix composition. Energy mix
reflecting the decreasing roles of oil and
increasing roles of coal and gas.
• Renewable energy is still small compare
with other fossil fuel energy, less than 5%

11. Projected Energy Growth 1980-2030
• Energy planning usually made with the
assumption of constant fuel source mix.
• Projection made with LEAP starter pack,
indicating the constant fuel source mix.
• The composition of fossil fuel estimated
to be more than 95% and renewable
remain around 5%
• Problem: Energy planning did not
consider future energy transition
• Energy mix is official indicator in National
Energy Planning of Indonesia. It is
important to consider the fuel mix in any
energy and environment planning

12. Historical & Projected Energy Growth 1900-2010
• In the last 100 years, there are four
phase of energy transition in Indonesia
from coal, oil, gas and renewable energy
• Energy consumption trend is increasing
• The transition trend is important to be
used as factor in designing the future
energy scenario

13. Impact of Energy Transition 1990-2010
GHG Growth & Energy Consumption
• The gas and coal rebirth age
begin in the period 1980-2000
• There is significant growth of
domestic coal consumption

14. Impact of Energy Transition 1990-2010
GHG by Sector
• There is significant growth of
domestic coal consumption,
especially in electricity/energy
generation

15. Historical PM 10 and PM 2.5
• Indonesia is one of the most
polluted country in the world
0
5
10
15
20
25
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
PM 2.5 μg / m3
PM2.5
0
10
20
30
40
50
60
70
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
PM 10 μg / m3
PM10

16. APPENDIX
16

17. Future Scenario
Coal,
30%
Gas,
21%
Oil,
41%
Renew
able,
8%
Coal, 30%
Gas, 22%
Oil, 26%
Renewab
le, 23%
Indicator 2010 2025 National Energy Policy
Primary Energy Supply 180 Mtoe 400 Mtoe
Energy Consumption per Capita 0.8 Mtoe 1.4 Mtoe
Electrification Ratio 81.6% 96.6%
Electricity Capacity 50 GW 115 GW
Electricity per Capita 620 Kwh 2500 Kwh
Renewable Energy Share 8% 23%
GHG Emission 1,800 Mt CO2e (2005) 29% Reduction (835 Mt)
17

18. Air Pollution is 4th leading cause of death in 2013
23%
22%
15%
10%
18

19. Primary Energy Supply 2003-2013 by Type
Average Growth 3.8%, Primary Energy Supply 228 Mtoe
Coal Oil Gas Hydro Geothermal Biofuel Biomass
MillionTonOilEquivalent(Mtoe)
30%
41%
21%
8%
8% Renewable Energy92% Fossil Fuel Energy
19

20. Final Energy Consumption 2003-2013 by Type
Energy Ladder, In 2007 convert 50 mill household from kerosene to LPG
Coal Gas Oil LPG Electricity
19%
14%
5%
13%
12%
17%
2%
10%
96% Fossil Fuel Energy4% Renewable Energy
Renewable
20

21. Industry Household Commercial Transportation Others Non Energy
Final Energy Consumption 2003-2013 by Sector
Average Growth 4.1%, Final Energy Consumption 174 Mtoe
MillionTonOilEquivalent(Mtoe)
33%
27%
27%
3%
3%
9%
21

22. Final Energy Consumption – Industry Sector
Average Growth 4.5%
MillionTonOilEquivalent(Mtoe)
Coal Gas Oil Other &RE ElectricityBiomass
22

23. Final Energy Consumption – Transportation Sector
Oil is the biggest source of energy in transportation sector
MillionTonOilEquivalent(Mtoe)
97,2% Oil
2.6% Biofuel
0.19% Gas
0.01% Electricity
23

24. Final Energy Consumption – Household Sector
Average LPG Growth 21%, Electricity 8%, Kerosene -19%
71%
13%
14%
MillionTonOilEquivalent(Mtoe)
Gas Kerosene LPG ElectricityBiomass
24

25. Final Consumption – Commercial Sector
Finance, Trading, Tourism, Services. Average Growth 5.9%
MillionTonOilEquivalent(Mtoe)
Gas Oil LPG ElectricityBiomass
25

26. Electricity
PP Type Shr. Grw.
Coal 46.7% 9.3%
Gas + Coal 19.3% 10%
Oil (Diesel) 11.6% 2.3%
Gas 8.6% 8.3%
Hydro 9.9% 4.4%
Geothermal 2.6% 3.9%
Renewable 0.5% <2%
26

27. Energy Keyword 1996 – 2015 (Energy Planning n = 50 papers)
Current Condition Gap Analysis
27

28. Indonesia Exports & Destinations
28