LoCARNet 2nd Annual Meeting“Comparison of Reduction Potential of Asian Countries In Achieving Two-degree Target”

I d i L C b D l t Indonesia Low Carbon Development Strategy Scenario 2050 for Energy Sector

Yokohama, 24 -25 July 2013

Dr. Retno Gumilang Dewi, Prof Dr Rizaldi BoerDr Ucok Siagian and Mr Iwan Hendrawan

INSTITUT TEKNOLOGI BANDUNG (ITB)

Dr. Ucok Siagian, and Mr. Iwan Hendrawan

INSTITUT TEKNOLOGI BANDUNG (ITB)INSTITUT PERTANIAN BOGOR (IPB)

OUTLINEOUTLINE

1. Introduction

2. Energy Sector and GHG Emissions

3 Future Visions for Achieving LCDS Toward 20503. Future Visions for Achieving LCDS Toward 2050

4. Development of The Scenario

5. Simulation Results

6 Policy Gap Analysis and Recommendation6. Policy Gap Analysis and Recommendation

INTRODUCTION 1

This presentation discusses LCDS Toward 2020 & 2050 for Energy Sector.

IntroductionThis presentation discusses LCDS Toward 2020 & 2050 for Energy Sector.

LCDS is usually intended to assess long‐term vision (2050). Particularemphasis in the short‐term (2020) is to address options for achieving GHGreduction target (National Action Plan) up to 26% below the baseline withdomestic budget and further up to 41% with international support.

GHG of energy sector increased: 50 5 Mton C (2000) to 82 Mton C (2005)GHG of energy sector increased: 50.5 Mton C (2000) to 82 Mton C (2005)and 117 Mton C (2010) energy sector is 2nd contributor of national GHGafter AFOLU. LCD Strategy of energy sector is not to achieve world’s target

b i t it l l it i t l ibiliti f th f ton carbon intensity level; it is more to explore possibilities of the futureenergy security and economic development in a low‐carbon way.

In the current energy supply mix (2010), role of new‐renewable energyIn the current energy supply mix (2010), role of new renewable energy(NRE) is still low (6.1%) oil (44.34%), gas 43.30 %, and coal 24.43%.

NRE and power sector are discussed in more detailed as there is a new plan(2011‐2020) that intends to revise power development plan (more coalcompared to previous plan (2009‐2018) will be deployed gradually).

Policy gap analysis and recommendation relevant to the achievement of thePolicy gap analysis and recommendation relevant to the achievement of theRAN GRK target are also addressed in this study.

Sector 2000 2001 2002 2003 2004 2005Growth ,% per

GHG Emissions, Ton CO2-eq per year Introduction

Sector 2000 2001 2002 2003 2004 2005yr

Energy 280,938 306,774 327,911 333,950 372,123 369,800 5.7Industry 42,814 49,810 43,716 46,118 47,971 48,733 2.6

Agriculture 75,420 77,501 77,030 79,829 77,863 80,179 1.1g , , , , , ,Waste 157,328 160,818 162,800 164,074 165,799 166,831 1.2

LUCF 649,254 560,546 1,287,495 345,489 617,423 674,828* Fluctuated

Peat Fire1 172,000 194,000 678,000 246,000 440,000 451,000 Fluctuated

Total (+LUCF) 1,377,753 1,349,449 2,576,952 1,215,460 1,721,179 1,991,371 Fluctuated

Total w/o LUCF 556,499 594,903 611,457 623,971 663,756 665,544 3.2

3.5

2.5

3.0

3.5

e) .

Peat Emission

2.95

0 25

1.44

1.5

2.0

2.5

on (G

t CO

2e Peat Emission

Waste

Forestry

Agriculture1 35

1.76

Nett emission will increase 1.000 05

0.06

0 050.43 0.29

0.13

0.16 0.17

0.250.39

0.830.06

0.5

1.0

1.5

Em

issi

o

Industry

Energy

1.35

from 1.35 to 2.95 GtCO2e (2000-2020)

0.28 0.37

1.000.04

0.050.050.05

0.0

0.5

2000 2005 2020

Introduction

Reduction target (non binding

Baseline 

ons level

Emission level target   

(non binding commitment, 26%)

G Emissio

2005 2020

ss o e e ta get

GHG

Sector Emission Reduction (Giga ton CO2e) Total

(41 %)26% 15% ( %)26% 15%

Forestry and Peatland 0.672 0.367 1.039

Waste 0.048 0.030 0.078

Agriculture 0.008 0.003 0.011

Industry 0.001 0.004 0.005

E 0 038 0 018 0 056Energy 0.038 0.018 0.056

Total 0.767 0.422 1.189

Effect of the revised power development plan to the amount of GHG p p pthat have to be reduced from the “higher coal in power” scenario

“Hi h l i ” i

Revised reduction targetBaseline 

“Higher coal in power” scenario

vel

Reduction target

mission

s le

902Emission level  target (to meet government emission reduction commitment)

GHG E

2005 2020

Type of energy Base year 2005 RUPTL 2009‐2018 Revised PLN plan* Coal 40.7% 53% 65% Oil 30.6% 4% 3%

Natural gas 15.1% 26% 20% hydro 8.4% 10% 5% geothermal 5.2% 7% 7%

ENERGY SECTOR AND ENERGY SECTOR AND GHG EMISSIONS 2

Current Condition of Energy Sector in Indonesia

Energy development is guided by ‘energy supply security’ concern (basedon least cost and resources availability) some fuels are still subsidized

Presidential regulation No.5/2006, target share in 2025 energy supply mix:- oil < 20% (decreases from 54.78% in 2005) - natural gas ≈ 30% (increases from 22.2% in 2005)

N t tnatural gas 30% (increases from 22.2% in 2005)

- coal > 33% (increased from 16.77% in 2005) - geothermal > 5% and other NRE > 5% - develop biofuel to achieve at least 5%

25% (2025)39 5% (2050)

New target

- develop biofuel to achieve at least 5% - develop liquefied coal to achieve 2% (18 MMBOE) in 2020

Shift of new-renewable from 4.5% (2005) to 25% (2025) and 39.5% (2050)

39.5% (2050)

( ) ( ) ( )is positive to GHG mitigations, however, coal increases from 14% (2003) to33% (2025) or 30% (2050) will negatively affect to GHG mitigations.

Th i i l d GHG b d l f RE There is potential rooms to reduce GHG by deplyoment of RE energy.

Indonesia relies on imported technology that are currently old technologiesand inefficient there are rooms for energy efficiency improvements andand inefficient there are rooms for energy efficiency improvements andreducing the GHG emission level.

Energy Resource Potential of Indonesia

Fossil Energy ResourcesReserves Annual

ProductionR/P,

(Proven + Possible) year (*)

Oil 56 6 BB l 8 2BB l (**) 357 MB l 23Oil 56.6 BBarels 8.2BBarels (**) 357 MBarels 23Natural Gas 334.5 TCF 170 TCF 2.7 TSCF 63Coal 104.8 Btons 18.8 Btons 229.2 Mtons 82Coal Bed Methane 453 TCF - - -

(*) assuming no new discovery; (**) including Cepu Block

New and Renewable E

Resources Installed CapacityEnergy

p y

Hydro 75.670 MW 4.200 MW

Geothermal 27.510 MW 1.052 MW

500 MW 86 1 MWMini/Micro Hydro 500 MW 86,1 MW

Biomass 49.810 MW 445 MW

Solar Energy 4,80 kWh/m2/day 12,1 MW gy

Wind Energy 9.290 MW 1,1 MW

Uranium (***) 3 GW for 11 years*) (e.q. 24,112 ton) 30 MW

***) Only at Kalan – West Kalimantan

Source: Data and Information Center, MEMR, 2011

) Only at Kalan – West Kalimantan

GHG i i l l f ili i i i (b )GHG emission level from energy utilization activity (by sector)

300

350

400

CO2‐e

Main sources 

150

200

250

million ton C

of GHG Emission from Energy Sector

50

100

150m

gy

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Fugitive 27  26  25  24  23  22  22  20  20  20  8 

Non‐specified 11  11  12  12  12  12  11  11  12  12  13 

R id ti l 38 39 41 42 42 41 40 34 31 28 26

0

Focus for Mitigation

Residential 38  39  41  42  42  41  40  34  31  28  26 

Transportation 57  60  62  65  70  73  71  79  81  89  96 

Industry 64  68  68  65  76  79  90  99  87  85  109 

Energy productions 84  102  120  127  132  127  129  117  122  129  135 

1250

1500

Biomassa

750

1000

ns B

OE Geothermal

Hydro

Oil Focus for

250

500milli

o Oil

Gas

Coal

Focus for Mitigation

0

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

1250

1500 ACM & others

Transportation

Commercial

Growth : 3.3% per year; Biomass is used in rural household

750

1000

ons

BO

E

Commercial

Household

Industry

250

500

milli

o

Household consumption includes Biomass  

0

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

400

Million barrel

Oil Fuels Consumption

250

300

350

AMC

Oil Fuels Consumption

100

150

200

C ommerce

Industry

Transport

Household

Notes:• Mostly used in transport• Household demand will decrease significantly

0

50

100

90

91

92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

decrease significantly, substituted by LPG

199

199

199

199

199

199

199

199

199

199

200

200

200

200

200

200

200

200

200

180

200

Million barrels

120

140

160

180

AvturDieselGasolineTransportation fuels

40

60

80

100Gasoline

Note: Other transport fuels ( l t i it d th li id

Transportation fuels

Potential to be replaced with

0

20

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

(gas, electricity and other liquid fuels) are much smaller

replaced with biofuel or  gas

FUTURE VISIONS FOR ACHIEVING LCDS TOWARD 2050 3LCDS TOWARD 2050

Socio Economic Parameter Base Year Target Year Target Year

2005 2020 2050

P l i Milli 219 261 327 Population, Million 219 261 327 Person per household 3.68 3.68 3.3 GDP (at constant price 2000), trillion IDR 1,787 4,572 30,244 GDP per capita, million IDR 8.152 17.519 92.508 GDP per capita, million IDR 8.152 17.519 92.508 Gross output, trillion IDR 3,533 10,657 70,490.1 ‐ Primary 329 629 4,157 ‐ Secondary 1,953 4,506 29,807 ‐ Tertiary (commercial) 1,251 5,522 36,525 Passenger Trip Generation (Ptg), trips 3.6 3.6 3.3 Passenger‐transport demand, billion psg km 1,763 2,145 2,463 Freight transport demand billion ton km 274 1 062 7 022 Freight‐transport demand, billion ton km 274 1,062 7,022

Base year:  2005 and Short Term Projection 2020 and Long Term Projection 2050

The society is depicted as calmer slower and nature oriented This scenario is regarded asThe society is depicted as calmer, slower, and nature oriented. This scenario is regarded as moderate development path, in which: 

- Population growth 1.03%/year (2005‐2020); and 0.89%/year (2020‐2050). 

- GDP growth 6% (2005–2010), 6,5% (2010‐2020), 7% (2020‐2050). 

BaU (moderate): current development trend and society orientation will continue until 2050, people lifestyles and activities do not have implication to the generation of CO2 emissions

Mitigation (moderate): same economic development with BAU but society is more efficient in energy utilizations (use technology with higher energy efficiency) compared to the BAU. 

DEVELOPMENT OF THE SCENARIO 4

S H O R T T E R M ( 2 0 2 0 ) A N D L O N G T E R M ( 2 0 5 0 )

SCENARIO

BaU 2020Short Term Target

Base Year2005

Mitigation 1 2020

Mitigation 2 2020g

* BaU 2020

Mi i i 1 2020

Revised* Short Term Target: Higher coal scenario *Revision related to the 

new plan in which higher

Base Year2005

Mitigation 1 2020

Mitigation 2 2020

new plan, in which higher coal will be deployed in the power supply mix

Mitigation 1 R 2020

Influences the Long Term Projection

g

Mitigation 2 R 2020

Long Term Target

Influences the Long Term Projection

* BaU 2050

Base Year2005

Mitigation 1 2050

Mitigation 2 2050

Mitigation 1 R 2050Mitigation 1 R 2050

Mitigation 2 R 2050

LOW CARBON MEASURES

MITIGATION OPTIONSMITIGATION OPTIONS

Short Term (2020):Mitigation actions to be included in the study are those options that are likely readily applicable and deployable in the near future such as energy efficiency measuresapplicable and deployable in the near future such as energy efficiency measures. 

M1 improve efficiency devices in Industri, Residensial, Comersial, and Transport Sector

M2 M1 +  improve efficiency coal Plant and transmission&distribution losses in Power Sector

M1 R M1 + install Solar Cell in Residential Sector

For long term (2050):

M1 R M1 +  install Solar Cell in Residential Sector

M2 R M1 + increase train and bus sharing in Transport Sector

For long term (2050):Mitigation options are generally relatively wide (efficiency measures to deploymentof advanced technology such electric cars fueled using renewable sources ,etc.)

M1 improve efficiency devices in Industri, Residential, Commercial, and Transport Sector

M2 M1 +  improve efficiency coal Plant and transmission & distribution losses in Power Sector

M1R M1 +  install Solar Cell in Residensial Sector

M2R M1 i i d b h i i T SM2R M1 + increase train and bus sharing in Transport Sector

END USER ENERGY EFFICIENCY MEASURESEND‐USER ENERGY EFFICIENCY MEASURES

Sector Penetration share of

Efficiency improvement of BAT

Remarks Sector share of BAT compared to

existing device

Remarks

I d t 30% 10 30% I th d l thi Industry 30% 10 – 30% In the model this efficiency improvement varies, depend on the

Commercial 15% 20 ‐ 30%

type of device (not sectoral aggregate) Residential 10% 10 ‐ 20%

Note: Penetration share of BAT in industry sector 30% means that in 2020 the technology (devices) used in the industry activities will comprise 30% BAT and 70% 

existing technology (less efficient).

SIMULATION RESULTS 55

Trillion IDR

70

80

Trillion IDR

Commercial

60

70 Cement

Iron and Stel

40

50 Other Industries

Construction

20

30 Construction

Chemicals

10 Textile, Wood, PaperFood and Beverage

-2005 2020 2050

Gross output of production sectorGross output of production sector

18

14

16

18Base 2020 2050

10

12

14

05=1

8

10

lueof 20

4

6Va

0

2

Population GDP Final Energy GHG EmissionsPopulation GDP Final Energy 

Demand

GHG Emissions

Snapshots of population GDP energy demand and GHGSnapshots of population, GDP, energy demand and GHG

7 000

6,000

7,000

ton

CO

2 Power Generation

Tertiary Industries

5,000 Milli

on

Cement

4,000 Iron and Stel

Other Industries

2,000

3,000 Construction

Ch i l

1,000

2,000 Chemicals

Textile, Wood, and Paper

-2005 2020BaU 2050BaU

PaperFood and Beverage

GHG emissions by sector

SCENARIO 2020 VS 2050SCENARIO 2020 VS 2050

1,400

1,600

illio

n to

e Commercial

Cement

2,500

ilio

n to

e

1,000

1,200

M Iron and Steel

Other Industries

Construction1 500

2,000 Mi

Biomass

600

800

,Chemicals

Textile, Wood, and PaperFood and Beverage 1,000

1,500 Geothermal

HydroPower

Natural Gas

Oil

200

400

600 Mining and Quarying

Agriculture

Households 500

Oil

Coal

-

200

2005 2020BaU 2050BaU

Freight transport

Passenger transport -2005 2020BaU 2050BaU

Final energy demand projection Primary energy supply mix

SCENARIO 2020 VS 2050 FOR POWER GENERATIONSCENARIO 2020 VS 2050 FOR POWER GENERATION 

00

800

900

Mill

ion

toe 2,500

O2e

Natural Gas

Oil

500

600

700 M

Biomass

Geothermal 1,500

2,000

illio

n to

n C

O Oil

Coal

300

400 HydroPower

Natural Gas

Oil

Coal

1,000

M

100

200 Coal

-

500

2005 2020B U 2050B U-2005 2020BaU 2050BaU

2005 2020BaU 2050BaU

Power generation by fuel type GHG emissions of power sector

SCENARIO 2020SCENARIO 2020

Table 1. Simulation results of the effect of ‘higher coal power’ to the SNC scenarios

Parameter 2005 2020 (SNC projection) Effect of higher coal in 2020

Base Year BaU M1 M2 BaU MR1 MR2 GDP (trillion IDR) 1,787 4,572 4,572 4,572 4,572 4,572 4,572 Population (million) 219 261 261 261 261 261 261Population (million) 219 261 261 261 261 261 261 Energy demand (million toe) 115.3 307 299 299 307.3 298.7 298.7 Energy demand per capita (toe) 0.5 1.2 1.1 1.1 1.2 1.1 1.1 Energy intensity (toe/million IDR) 63.6 67.2 65.3 65.3 67.2 65.3 65.3

l i iEnergy Elasticity 1.06 1.03 1.03 1.06 1.03 1.03 CO2 emission (million ton-CO2)* 290 949 915 897 977 915 906 Carbon Intensity - Ton CO2 per capita 3.6 3.6 3.5 3.4 3.7 3.5 3.5Ton CO2 per capita 3.6 3.6 3.5 3.4 3.7 3.5 3.5 - Ton CO2 per million IDR 208 208 200 196 214 200 198

*It does not include CO2 emission from fugitives

Parameter2005 2020 2050

Base Year BaU M1 M2 BaU  M1  M2 

GDP (trillion IDR)1 787 4 479 4 479 4 479 29 549 29 549 29 549

( )1,787  4,479  4,479  4,479  29,549  29,549  29,549 

Population (million) 219 261 261 261 307  307  307 Energy  demand per capita (toe) 0.6  1.0  0.9  0.9  4  3  3 p ( )

Energy intensity (toe/million IDR) 68.3 56.5 53.4 53.4 38  33  33 

GDP Growth rateGDP Growth rate6.3% 6.3% 6.3% 0  0  0 

Energy Demand Growth rate 5.0% 4.6% 4.6% 0  0  0 

Energy Elasticity 0.79 0.73 0.73 1  1  1 Ton CO2 per capita 1.5  3.3  3.2  3.1  13  11  10 Ton CO2 per million IDR 185  193  185  181  137  119  101 

FINAL ENERGY DEMAND 2020 FINAL ENERGY DEMAND 2020

300

350

illio

nTO

E Commercial

Cement

Iron and Steel

300

350

illio

n to

e

200

250

Mi Iron and Steel

Other Industries

Construction200

250

Mi

Electricity

150

Chemicals

Textile, Wood, and PaperFood and Beverage

150

Electricity

Biomass

Natural Gas

Oil

50

100 Mining and QuaryingAgriculture

Households50

100 Coal

-

2005

020B

aU

2020

M1

2020

M2

Freight transport

Passenger transport

-

2005

020B

aU

2020

M1

2020

M2

20 2 2 20 2 2

by Sector by Fuel Type

PRIMARY ENERGY SUPPLY BY TYPE OF ENERGYPRIMARY ENERGY SUPPLY BY TYPE OF ENERGY

400

450

on

toe

300

350

Mill

io

Biomass

200

250

300 Geothermal

HydroPower

100

150

200 Natural Gas

Oil

Coal

50

100 Coal

-2005 2020BaU 2020M1 2020M2

CO2 EMISSION 2020CO2 EMISSION 2020

900 

1,000 

tonCO2

Power Generation

Tertiary Industries

Cement

902 900

1,000

tonC

O2

natural gas

902

600

700 

800 

million t Cement

Iron and Stel

Other Industries

Construction 600

700

800

Milli

lion

t natural gas

oil

coal

400 

500 

600  Construction

Chemicals

Textile, Wood, and PaperFood and Beverage

400

500

600

100 

200 

300 

g

Mining and Quarying

Agriculture

Households100

200

300

‐

2005 2020BaU 2020M1 2020M2

Freight transport

Passenger transport-

100

2005 2020BaU 2020M1 2020M2

CO2 Emissions by Fuel TypeCO2 Emissions by Sector

REVISED POWER GENERATION PLANREVISED POWER GENERATION PLAN

400

450

O2‐e

300

350

on ton CO

150

200

250

Millio natural gas

oil

coal

50

100

150 coal

0

50

2020BaU 2020BaU Higher Coal

CO2 Emissions Power Sector

MITIGATION SCENARIOSFOR “HIGHER COAL POWER”

Efficiency measures (end-user and supply sides Efficiency measures (end user and supply sides +

transport mode shifttransport mode shift

END-USER ENERGY EFFICIENCY MEASURES, APPLIED IN M1 AND M2

Sector Penetration share of

Efficiency improvement of BAT

Remarks Sector share of

BAT compared to existing device

Remarks

Industry 30% 10 30% In the model this Industry 30% 10 – 30% In the model this efficiency improvement varies, depend on the

Commercial 15% 20 ‐ 30%

type of device (not sectoral aggregate) Residential 10% 10 ‐ 20%

Note: Penetration share of BAT in industry sector 30% means that in 2020 the technology (devices) used in the industry activities will comprise 30%

the technology (devices) used in the industry activities will comprise 30% BAT and 70% existing technology (less efficient).

CHANGE OF TRANSPORT MODE CHANGE OF TRANSPORT MODE

100%

80% Airplan

Bicycle

60%

dal share Walk

Ship

Motorcycle20%

19%10%40%M

od Motorcycle

Small Vehicle

Large Vehicle

15% 15%20%

20% Bus

Train

2% 2% 6%0%

2005 2020 Higher Coal 2020M2(R)

GHG EMISSIONS 2020, ,HIGHER COAL AND MITIGATIONS

1,000

nCO2‐e

Power Generation

Tertiary Industries902800

Million to Tertiary Industries

Cement

Iron and Stel

Oth I d t i

902

600Other Industries

Construction

Chemicals

400 Textile, Wood, and Paper

Food and Beverage

Mining and Quarying200

Mining and Quarying

Agriculture

Households

F i ht t t0

2020BaU 2020BaU Higher Coal

2020 M1(R) 2020 M2(R)

Freight transport

Passenger transport

GAP ANALYSIS AND RECOMMENDATION 6GAP ANALYSIS AND RECOMMENDATION

POSSIBILITY THE USE OF BIOMASS BASED ENERGY

BIOMASS RESOURCES POTENTIAL IN ASEAN COUNTRIES

Sources:Sources: Saku Rantanen (Pöyry), 2009

Large Potential is still unutilized!.

Source: Sou ceSaku Rantanen (Pöyry), 2009

FUELSDEM AND Fossils Fuels

I t

FOSSIL FUELS SUPPLY

+-

Fossil FuelsConsumption

Fossil FuelsProduction

Resource

Crude OilExploration

Import

Fuel Demand

GlobalEnvironmental

Pressure

+

-

-

+-+

++

FUELSPRICES

EnergyEffi i

DepletionPotential

Gross DomesticProduct

PricingPolicy

GlobalEnergy Price

+

+

-

-

EfficiencyDomestic

Fuels Price

DomesticBi f l P i

DomesticBiofuelssupply

BiofuelsExport

Global BiofuelPrices

++

--

+

+++

+

BIOFUELSINDUSTRY

Economic Feasibility

Biofuels Price

Employment

pp y

BiofuelsProduction

Export

++

+

+

of BiofuelsLandConversion

PolicyAgricultural

Product Price

Land availability

BiofuelPlantation+ -

+

+

AGRICULTURE

Food SupplyFood cropsland

Forest

Land availabilityfor biofuel

+-

-

++

+

+

FORESTRY

Food cropsextensification Food

Se curity

ForestConservation

EffortsDefore station+

+-

THE POSIBILITY TO USE BIOMAS BASED ENERGY POTENTIAL (PARTICULARLY BIFUELS) IN TRANSPORTATION, INDUSTRY AND POWER) ,

NEEDS TO INTEGRATE ENERGY MODEL AND AFOLU MODELNEEDS TO INTEGRATE ENERGY MODEL AND AFOLU MODEL 

GAP ANALYSIS OF CURRENT POLICY

Th t t f N ti l A ti Pl F R d i GHG E i i ld b hi d

GAP ANALYSIS OF CURRENT POLICY 

The target of National Action Plan For Reducing GHG Emissions could be achievedthrough Energy Efficiency (EE) measures in supply/demand side.

Demand side EE could be implemented when following conditions prevail:Demand side EE could be implemented when following conditions prevail:• Efficient appliances are available and relatively easy to access• Producers have technical & financial capability to produce eff. appliances• Producers have the needed drive to produce efficient appliances (there is a• Producers have the needed drive to produce efficient appliances (there is a

market demand of their product)• Energy users have the drive to safe energy.

E h fi i l i i ffi i li ( ll• Energy consumers have financial capacity to acquire efficient appliances (usuallyexpensive)

Supply side EE could be implemented when following conditions prevail:• There is an economic drive or stimulant for power generators to improve 

efficiency. Under current subsidy system such drive may not existy y y y• Strict regulation that prevent construction of less efficient power plant. The GOI 

should set minimum thermal efficiency for new power plants

RECOMENDATIONRECOMENDATION

In demand side, the following policy/regulations are recommended:• To ensure the use of efficient energy appliances, introduce incentive packages 

for energy consumer such as help for financing of expensive but efficientfor energy consumer such as help for financing of expensive but efficient appliances. 

• Introduce building codes that promote energy efficiency: make the use of efficient appliances & energy efficient design as requirement for constructionefficient appliances & energy efficient design as requirement for construction approval.

• Introduce EE as a major criteria in rating of industrial environmental complianceSt th it f t ffi i l i EE h i l ti d• Strengthen capacity of government officials in EE arena such as in evaluating andinspecting the efficiency of energy systems and energy audit document reportedby industry/building sector; the government officials that need to be strengthenis not limited to energy ministry but also for officers at other ministry that dealswith energy related issues such as ministry of environment, ministry of publicworks, ministry of industry, ministry of finance etc.

• Introduce energy pricing policy that promotes energy efficiency: gradual removalelectricity and oil subsidies.

In supply side, the following policy/regulations are recommended:

I d l i f h ill i h ffi i• Introduce regulations for power sector that will increase the efficiency of power plant by making a mandatory to use best available technology in new coal power plant construction; new coal power gy p p ; pplants options include circulated coal fluidized bed combustion (CFBC), sub‐ or super‐critical coal power plants; stoker‐type coal power system 

d t b h d t thi l ti h ld l t PLN dmay need to be phased out; this regulation should  apply to PLN and IPP as well as to industry that generate their own electricity 

• Introduce regulations that would force the electricity company• Introduce regulations that would force the electricity company continuously to reduce technical losses at their transmission and distribution systems e.g. by using higher voltage transmissions lines and improvement of transformer at the power substations. 

Thank You

gelangdewi@yahoo.comg g @y

gelang@che.itb.ac.id