20211117-科尔尼-Indonesia_s_energy_transition_a_case_for_action_30页_1mb

Indonesia's Energy Transition Analysis Summary

Key Findings

Energy Transition Overview

• Energy Transition (ET) involves shifting energy sources and technologies to enhance efficiency, minimize environmental impacts, and reduce greenhouse gas (GHG) emissions.
• Globally: Hydro dominates renewable electricity (65% in 2017), but solar and wind account for over 80% of incremental capacity.
• By 2050, renewable energy (RE) is expected to account for ~67% of global electricity generation (excluding nuclear).

Indonesia's Context

• Current Status:
  • Installed capacity: ~61 GW total, 88% from fossil fuels.
  • RE generation average: ~12% (2017), stagnant over time.
  • Targets: 23% of primary energy mix by 2025, with coal and oil dominance expected to persist regardless of RE adoption.
• Challenges:
  • Stagnant RE share despite growing electricity demand (6-7% annually through 2027).
  • Required investment: ~$62 billion (Rp900 trillion) by 2025, average $8 billion/year.

Key Issues

• Policy and Regulatory Uncertainty:
  • Unfavorable RE tariffs (based on fossil fuel costs), unclear PPA structures, and frequent regulatory changes hinder investment.
  • Land acquisition and permitting processes are bureaucratic and lenient.
• Technological Constraints:
  • Grid infrastructure inadequate for variable RE sources (solar, wind).
  • Low wind speeds in populated areas and limited land/solar availability in high-potential regions.
• Financial Barriers:
  • High interest rates (6-12%) and limited long-term financing options for RE projects.
  • Large reliance on PLN as a power monopolist, creating conflicts of interest in RE promotion.

Recommendations

1. Policy Overhaul:

   • Institute a Feed-in Tariff (FiT) scheme with tariffs higher than fossil fuels (e.g., like Vietnam's approach—9.35 cents/kWh for solar).
   • Align regulations with RE market maturity, addressing ambiguities in LCR and PPA frameworks.

2. Remove Barriers:

   • Re-evaluate rigid Local Content Requirements (LCR) to balance market demands and national interests.
   • Streamline land acquisition and permitting procedures to expedite project approvals.

3. Boost Investment:

   • Utilize fiscal incentives (tax credits, green bonds) and public-private partnerships to attract private capital.
   • Leverage international climate finance and regional partnerships (e.g., IRENA).

4. Off-Grid Focus:

   • Accelerate deployment in underserved rural areas via distributed RE, aligning with electrification goals (99.9% by 2019).
   • Simplify concession processes to encourage modular projects in multiple villages.

Estimated Renewable Energy Growth

• Low RE growth (global trends): 0.4% annual increase vs. electricity generation growth.
• Alternative Scenario Needed: To reach 23% by 2025, RE must more than double its current growth rate.

Conclusions

• Indonesia's energy transition is critical for climate goals, energy security, and fiscal stability.
• Accelerated RE adoption requires coordinated policy reform, financial mechanisms, and targeted investments.