Indonesia

Index rank 83

Energy Sustainability Index Rankings

 2010  2011  2012  Trend
Energy Performance  69  79  86 
Energy Security  29  47  60 
Social Equity  66  61  72 
Environmental Impact Mitigation  88  90  90 
       
Contextual Performance  68  62  59 
Political Strength  73  70  69 
Societal Strength  71  69  72 
Economic Strength  51  40  32 
       
Overall Rank  71  76  83 
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Fossil Fuel Resources

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Key Metrics

Industrial sector (% of GDP) 47.2
TPEP / TPEC  (net energy exporter) 2.10
Emission intensity (kg CO2 per USD) 1.26
Energy affordability (USD per kWh) 0.06
GDP / capita (PPP, USD); GDP Group 4,353 (D)
Energy intensity (million BTU per USD) 0.02
CO2 emissions (metric tons) / capita) 2.70
Population Access to Electricity (%) 64.5
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Index Commentary

Indonesia falls seven places in the Index. A drop in energy security is driven by a decrease in the weakest indicator, the wholesale margin on gasoline; this was offset by a slight reduction in the 5-year energy consumption trend. However, the energy consumption growth rate remains positive which is necessary for Indonesia’s social and economic development as only 65% of the population have access to electricity, leading to low social equity scores. Environmental performance remains constant but is overall very weak due to high emissions from heat and electricity generation and a low quality of air and water. Indonesia underperforms in mitigating its environmental footprint compared to other countries with similar levels of energy intensity per capita. Political and societal strength remains mostly stable, although a small deterioration of control of corruption and rule of law lead to a small drop of societal strength. The strong economic performance is supported by low costs of living as proportion of household consumption expenditure and a good macroeconomic stability, slightly offset by low credit availability.

Trends and Outlook

Fossil fuels remain the main energy source, and levels of development and deployment of efficient and low-carbon and carbon-free energy technologies is slower than expected to fulfill sustained energy demand growth which remains positive under significant energy subsidy to support social and economic development. Recent energy policy developments include: 1) energy policy targets of the Presidential Decree No. 5, 2006 on National Energy Policy and its Blueprint of National Energy Management 2005-2025. The targets include reduce energy elasticity to less than 1 which is aligned with the target of economic growth, enhance the national energy mix with oil below 20%, natural gas more than 30%, coal to more than 33%, and the remaining 17% from new and renewable energy; 2) the Ministerial Decree on FIT for renewable energy which gives more opportunity for development of small renewable energy with private participations. This will give remote islands the opportunity to accelerate access to electricity; and 3) preparations to issue a new national energy policy as the implementation of Energy Law No. 30, 2007. Key issues policymakers need to continue focusing on include: 1) removing energy subsidies; 2) intensifying the efforts to increase the use of new and renewable energy through research and development, pilot projects, providing incentives, capacity building, etc.; 3) imbed low-carbon and carbon-free technologies in the long-term energy plan; 4) increase energy efficiency on supply and demand sides; and 5) attract more investments to the energy sector.