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SMEs, energy ministries join forces to push EV adoption
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he Energy and Mineral Resources Ministry and the Cooperatives and Small and Medium Enterprises (SMEs) Ministry are working together to increase small businesses’ role in pushing electric vehicle (EV) adoption in Indonesia.
The ministries signed a memorandum of understanding (MoU) on Tuesday to officiate the partnership aimed to providing training for SMEs that will enable them to convert traditional motorcycles into electric ones.
The energy ministry’s renewables director general, Dadan Kusdiana, said the ministry aimed to have 1,000 combustion engine motorcycles converted to electric vehicles in 2022. The conversion program will be financially supported by two state-owned companies, Pertamina and PLN.
Moving forward, the energy ministry wants 13 million two-wheelers converted by 2025. The conversion is estimated to save Rp 319 trillion (US$22.16 billion) and reduce carbon dioxide emissions by 65 million tons.
“[The conversion of motorcycles] will create [potential sales] of Rp 50 trillion for SMEs, because they are expected to provide the necessary components for the conversion,” he said at the signing ceremony.
Read also: Indonesia 'still far' from EV adoption target: Ministry official
Pushing EV industry growth is part of the government's larger scheme to reduce greenhouse gas emissions by 29 percent by 2030.
Though high prices of EVs and limited availability of charging stations remain a challenge, Indonesia has been making significant progress in recent months in its ambition to become a major player in the EV industry.
The country envisions itself as a global supplier of EV batteries, leveraging its ample reserves of key materials like nickel, of which it is the world’s largest producer.
Read also: First Volta factory to churn out 5,000 e-motorcycles per month
As of 2021, the energy ministry has converted 100 fuel-powered motorcycles into electric bikes that have passed a roadworthy test by the Transportation Ministry.
“[We are] optimistic that EVs will continue to grow, [supported by] collaboration between the government, SMEs and the private sector,” said SME ministry secretary Arif Rahman Hakim.
