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How coal, renewables have replaced oil in Indonesia’s energy mix
The country has made a long stride in green energy, but at the same time is not willing to give up coal consumption.
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The contribution of green energy and coal to Indonesia's primary energy mix has grown proportionally larger over the past five years. (Shutterstock/Krisana Antharith)
T
he contributions of green energy and coal to Indonesia's primary energy mix have grown proportionally larger over the past five years, pushing out oil while gas has stagnated, a trend that reflects Indonesia’s prioritization of energy security and lower attention to sustainability.
Renewable energy now contributes more than double the 4.4 percent it did in 2015, rising to 11.5 percent in 2020, while coal grew from 27.9 percent to 38.7 percent – retaining the largest share – over the same period, government data show.
“Our energy policy, going forward, firstly, is to maximize all resources that are within the country,” said Energy and Mineral Resources Minister Arifin Tasrif at a press briefing on Jan. 7.
The minister’s remarks attest to how Indonesia’s energy policy is largely geared toward using locally available energy resources to make it affordable for all citizens at the expense of sustainability, both financial and environmental sustainability.
The benchmark in the country’s energy white paper, 2014 National Energy Policy (KEN), requires the country to hit a minimum 23 percent green energy mix by 2025 but it also mandates minimum proportions for gas, at 22 percent, and coal, the dirtiest fossil fuel, at 30 percent. The policy only imposes a maximum on oil use at 25 percent. Among the four primary energy sources, only coal has exceeded the KEN target.
Indonesia is relatively rich in coal, gas and renewables but not in oil, which it heavily imports at the expense of a swelling trade deficit, a key vulnerability for Southeast Asia’s largest economy. Statistics Indonesia (BPS) data show that Indonesia’s processed oil deficit hit US$795.4 million while crude oil hit a small surplus of $96 million in December 2020.
