Business

Private sector invited to join village energy programs

Aditya Suharmoko, The Jakarta Post, JAKARTA | Fri, 09/11/2009 12:00 PM
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Private sector and local governments are expected to participate more in helping villages reach energy self-sufficiency as the central government is lacking the funds to run such programs alone.

Under the central government’s energy self-sufficiency villages program (DME) that has run since 2007, 633 villages have reached energy self-sufficiency at the cost of Rp 895.3 billion (US$89 million), Bayu Krisnamurthi, a deputy to the coordinating minister for the economy, said Thursday.

Of about 70,000 villages in Indonesia, between 3,000 and 4,000 need to reach energy self-sufficiency, “costing from Rp 4.5 trillion to Rp 5 trillion”, he said in an expose of the two-year running program.

“We have invested Rp 75 billion this year but we still need support. The current development is still ad-hoc [temporary],” he said.

“Information, technology and support are three crucial points. We invite the private sector to conduct corporate social responsibility [CSR] program [in villages], and local governments to put more [effort into] this issue,” he added.

The government expects all of the 4,000 villages targeted can reach energy self-sufficiency by 2014, said Musdhalifah Machmud, coordinator of the program.

The DME program is aimed at increasing the opportunities for and productivity of economic activities in villages. It is also expected to become an instrument to help bridge the gap between rich-resource areas and poor-resources ones.

The source of energy for each village is based on resources that exist in each area, said Musdhalifah.

“Among others  there are micro-hydro, biogas, and biofuel involving eight related ministries,” she said.

Under the DME program, villages learn to develop renewable energy that will reduce the use of fossil-based energy, Bayu said.

It will also benefit the government as fluctuating global oil prices may cause the government’s allocation for fuel subsidies to balloon based on higher global prices.

Dieter Brulez of the German Technical Cooperation (GTZ) said with the existing level of coordination, it would be difficult to see 3,000 villages reaching energy self-sufficiency by 2014.

GTZ proposed the DME program should be redesigned as a special program by strengthening the organization, and the role and responsibility of the parties involved during the transition process.
Brulez said it would take two years to prepare the special program, and at least three years to disseminate the technology, costing about Rp 7 billion.

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