Indonesia National Energy Policy

Indonesia National Energy Policy Presented By : DR Tumiran Member of The National Energy Council Republic of Indonesia. Dean Of Engineering Faculty, Gadjah Mada University.

INDONESIA G E O G R A P H I C S P R E A D INDONESIA IS TE WORLD S FOURTH MOST POPULOUS NATION WITH 240 MILLION PEOPLE IT IS SPREAD OVER A LARGE ARCHIPELAGO TROPICAL REGIONS OF MORE THAN 6000 INHABITED ISLANDS, BUT 80% POPULATION LIVE IN JAVA-MADURA-BALI

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL I. ENERGY INRODUCTION

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL INDONESIA N ENERGY CONDITION 1. INDONESIA HAS AN ABUNDANT ENERGY RESOURCES. 2. OIL FUEL CONSUMPTION IS STILL DOMINANT, CONSISTING 47% OF TOTAL ENERGY CONSUMPTION 3. LARGE QUANTITIES OF ENERGY are Exported. DATA: CRUDE OIL EXPORTted IN 2008: 399 THOUSAND BARRELS A DAY, DOMESTIC CONSUMPTION : 248,19 THOUSAND BARRELS A DAY AND CRUDE OIL IMPORTS IN 2008: 254THOUSAND BARRELS A DAY EXPORTS OF NATURAL GAS IN 2008: 4.114,3 MMSCFD PER DAY, DOMESTIC CONSUMPTION: 3.769,2 MMSCFD PER DAY EXPORTS OF COAL: 211 MILLION TONS PER YEAR, DOMESTIC CONSUMPTION: 75,43 MILLION TONS PER YEAR 4. FOR GAS AND COAL, EXPORT MARKET PRICE ARE HIGHER THAN DOMESTIC MARKET 5. DOMESTIC LOW PURCHASING POWER ON COAL AND GAS, AND NO FISCAL OR NON- FISCAL ECONOMIC INCENTIVE TO ENCOURAGE THE USE OF FOSSIL ENERGY BACKGROUND National Energy Security and Sustainability NATIONAL ENERGY COUNCIL DUTY ACCORDING TO UU RI NOMOR 30 TAHUN 2007 ( PASAL 12 AYAT 2 ) 1 TO DESIGN AND FORMULATE THE NATIONAL ENERGY POLICY To be Adopted by Government with Approval of the House of People s Representatives, 2 TO DETERMINE NATIONAL ENERGY Planning PROPOSED BY THE GOVERNMENT 3 To Determine the Crisis and Emergency of National Energy Condition and Taken a necessary action. 4 TO MONITOR THE IMPLEMENTATION OF CROSS-SECTORAL ENERGY POLICY

DEWAN ENERGI NASIONAL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL BACKGROUND OF LAW S NATIONAL ENERGY COUNCIL (DEN) UUD 1945 UU NO. 30/2007 ABOUT ENERGY PERPRES NO. 26/2008 about regulation National Energy council policy establisment MEI 7, 2008 KEPPRES NO. 17/P/ 2009 Appointment of National Energy council Members MARCH 18, 2009 KEPPRES NO. 11 / 2009 About ORGANITATION STRUCTURE DAN WORKING PROCEDURES OF GENERAL SECRETARY OF NATIONAL ENERGY COUNCil APRIL 22, 2009 PERMEN ESDM NO. 14 TAHUN 2009 ABOUT MAIN TASK OF NATIONAL ENERGY COUNCIL JULY 31, 2009 1

DEWAN ENERGI NASIONAL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATIONAL ENERGY COUNCIL ORGANIZATION CHAIRMAN VISE CHAIR DAILY CHAIR MEMBERS : PRESIDENT : VICE PRESIDENT : MINISTER OF ENERGY AND MINERAL RESOURCES 7 MINISTER INDEPENDENT MEMBERS 1. FINANCE MINISTER 2. NATIONAL PLANNING AGENCY (BAPPENAS) 3. MINISTER OF RESEARCH AND TECHNOLOGY 4. MINISTER OF TRANSPORTATION 5. MINISTER OF INDUSTRY 6. MINISTER OF AGRICULTURE 7. MINISTER OF ENVIRONMENT 1. IR. AGUSMAN EFFENDI (CONSUMERS); 2. PROF. DR. HERMAN AGUSTIAWAN (CONSUMERS); 3. DR. IR. TUMIRAN, M.ENG (AKADEMIC); 4. PROF. IR. RINALDI DALIMI, M.SC, PH. D (AKADEMIC); 5. IR. EDDIE WIDIONO S, M.SC (INDUSTRIAL); 6. DR. IR. HERMAN DARNEL IBRAHIM, M.SC (INDUSTRIAL) 7. PROF. WIDJAJONO PARTOWIDAGDO, PH.D (TECHNOLOGY); 8. DR. IR. MUKHTASOR, M. ENG. PH.D (ENVIRONMENT); 2

ENERGY SECURITY Sustainability SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATIONAL ENERGY POLICY (Law Number 30 of 2007 on Energy ) SUPPLY SIDE POLICY SHIFTING PARADIGM SECURITY OF SUPPLY ENERGY PRICE EXPLORATION- PRODUCTION CONSERVATION (PRODUCTION OPTIMIZATION) DIRECT SUBSIDY DIVERSIFICATION DEMAND SIDE POLICY COMMUNITY AWARENESS CONSERVATION (EFFICIENCY) 7

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL DOMESTIC ENERGY DEMAND 2007 2010 HOUSEHOLD AND COMMERCIAL SECTOR 2007 HOUSEHOLD AND COMMERCIAL SECTOR 2010 Transportation sector 2007 Transportation sector 2010

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL INDUSTRIAL SECTOR 2007 INDUSTRIAL SECTOR 2010 GENERATION FOR ELECTRICITY 2007 GENERATION FOR ELECTRICITY 2010

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL INDONESIA ENERGY RESERVE

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATURAL ENERGY PRODUCTION AND RESERVE (2007) Fossil Energy Potential Resources Reserves Production Res./Prod. (years) Oil 56,5 billion barrel 8,4 billion barrel*) 348 million barrel 24 Natural Gas 334,5 TSCF 165 TSCF 2,79 TSCF 59 Coal 90,5 billion ton 18,7 billion ton 201 million ton 93 Coal Bed Methane (CBM) 453 TSCF - - - *) Including Cepu

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL ENERGY RESOURCES

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL CASES: 1.ELECTRICITY SECTOR 2.RENEWABLE ENERGY SECTOR 15

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL 1. THE ELECTRICAL SECTOR DEVELOPMENT AND ITS PROSPECTIVE IN INDONESIA

Pasar Energi Primer SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL SISTEM KETENAGALISTRIKAN INDUSTRI Sistem Besar terintegrasi vertikal BISNIS PLTA PLTD PLTP PLTG PLTU PLTGU GARDU STEP-UP GARDU STEP DOWN TRAFO STEP DOWN RUMAH SOSIAL/ PUBLIK SISTEM PEMBANGKIT SISTEM TRANSMISI SISTEM DISTRIBUSI KONSUMEN PILIHAN QUALITY & RELIABILITY MW Daya Mampu Pembangkit Rp/kWh MW Total termasuk Rumah Tangga 00 06 12 POLA PRODUKSI 18 22 24 WBP Hydro (7%) HSD (17%) MFO (7%) COAL (42%) GAS (19%) GEO (5%) ROR (2%) Waktu 5-18 1650-2475 115-161 150-300 400-450 5-18 0 2 4 6 8 10 12 14 16 18 20 22 24 POLA KONSUMSI WBP Total tanpa Rumah Tangga Industry Rumah Tangga Bisnis Social + Public Waktu

ELECTRICITY DEVELOPMENT POLICIES SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL FULFILLMENT OF ELECTRICITY DEMAND EXPAND SUPPLY CAPABILITIES; ENHANCEMENT OF ELECTRICITY ACCESS, ELECTRIFICATION RATIO 93% IN 2025. CREATION OF EFFICIENT ELECTRICITY BUSINESS ENVIRONMENT ELECTRIC POWER UTILITIES CARRY OUT THEIR BUSINESSES IN EFFICIENT, EFFECTIVE, TRANSPARENT AND ACCOUNTABLE MANNER (GOOD UTILITY PRACTICE). DEVELOPMENT OF INFRASTRUCTURES TRANSMISSION AND DISTRIBUTION SYSTEM; SUPPORTING INFRASTRUCTURES (OIL PIPELINES, GAS PIPELINES, LNG TERMINALS, COAL TRANSPORT FACILITIES).

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL National Electrification Ratio 2009 : 65 % NAD 74,91% Sumbar 68.72% Jambi 48.85% Bengkulu 50.08% Banten 72,11% Sumut 69,32% Lampung 47,66% Riau + Kepri 54,66% Jabar 64,95% Sumber: ESDM, per propinsi Sumsel 49,80% Kalbar 45,65% Babel 72,45% Jakarta 100% Jateng 70,60% Kalteng 44,33% Kalsel 71,39% Jatim 71,08% Jogya 79,64% Kaltim 68,37% Sulsel 54,90% Bali 74,42% NTB 31.99% Gorontalo 48,70% Sulteng 47,64% Sultra 38,21% NTT 24.24% Sulut 66,62% Maluku 55,36% Kategori: Malut 47,81% > 60 % 41-60 % 20-40 % Papua + Irjabar 32,05%

Rasio Elektrifikasi [ % ] SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Electrification Ratio to The GDP per Capita 100 China Thailand Malaysia Brasil Eropa Jepang Amerika Serikat 80 Philipina Asia Rusia World Bolivia Afrika Selatan 60 INDONESIA India Ghana Nigeria 40 100 1,000 10,000 100,000 GDP per Kapita [ US$ ] Sumber Data : IEA, World Energy Outlook 2006

Kapasitas Terpasang [GW] SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Existing Installed Capacity Compared To the Poppulation 10,000 1,000 Amerika Serikat China Jepang Rusia 100 10 Korsel Argentina Kenya Malaysia Perancis Inggris Myanmar Brasil Thailand INDONESIA Pakistan Philipine Vietnam Nigeria India 1 10 100 1,000 10,000 Penduduk [Juta] Sumber Data : IAEA, US DOE

GROWTH OF ELECTRICITY DEMAND PROJECTION IN YEAR 2009 & 2010 SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL SUMATERA 2009 2010 Demand (GWh) : 17,071 18,371 Peak Load (MW) : 3,564 3,832 Additional (MW) : 404 431 KALIMANTAN 2009 2010 Demand (GWh) : 5,047 5,456 Peak Load (MW) : 1,084 1,171 Additional (MW) : 134 137 (based on RUKN 2008 2027) SULAWESI 2009 2010 Demand (GWh) : 4,351 4,643 Peak Load (MW) : 1,039 1,108 Additional (MW) : 104 112 MALUKU 2009 2010 Demand (GWh) : 455 489 Peak Load (MW) : 100 108 Additional (MW) : 11 12 PAPUA 2009 2010 Demand (GWh) : 672 735 Peak Load (MW) : 151 165 Additional (MW) : 22 21 JAMALI 2009 2010 Demand (GWh) : 122,483 133,856 Peak Load (MW) : 21,141 23,084 Additional(MW) : 2,678 2,848 NUSA TENGGARA 2009 2010 Demand (GWh) : 958 1.029 Peak Load (MW) : 237 254 Additional (MW) : 26 28

Map Location of Power Plant Crash Program Phase 2 SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Core Project HEPP : GeoP : SCPP : CCPP : SUMATERA 174 MW 1.590 MW 1.114 MW 120 MW KALIMANTAN Core Project SCPP : 840 MW CCPP : 120 MW (based on RUKN 2008 2027) SULAWESI Core Project Geopp : 145 MW SCPP : 418 MW MALUKU Core Project Geopp : 40 MW SCPP : 40 MW PAPUA Core Project SCPP : 114 MW JAMALI Core Project HEPP : 1.485 MW GeoP : 2.000 MW SCPP : 1.200 MW CCPP : 1.000 MW NTT Core Project Geopp : NTT Core Project Geopp : 46 MW SCPP : 30 MW 30 MW SCPP : 70 MW Total Core Project HEPP : 1.174MW GeoP : 3.336 MW SCPP : 4.630 MW CCPP : 1.440 MW Total : 10.580 MW

SEKRETARIAT JENDERAL Production DEWAN ENERGI NASIONAL Cost and Revenue (Conceptual Approach) Profit Revenue (R) Subsidi (S) Z Y IDEAL Profit + Z + Y > X Revenue total > X Biaya (BPP = P) X Biaya (BPP = P) Profit Revenue (R) Subsidi (S)

SEKRETARIAT GROWTH JENDERAL DEWAN ENERGI OF NASIONALELECTRICITY DEMAND PROJECTION (based on RUKN 2008 2027) TWh 1.000 800 600 400 200 0 Year 2008 2012 2017 2022 2027 Jam a l i 112 160 256 415 684 Outside Jamali 28 38 56 84 129 Indonesia 140 198 312 499 813 ASSUMPTIONS: NATIONAL GDP GROWTH: 6.1% NATIONAL POPULATION GROWTH : 1.3% NATIONAL ELECTRICITY DEMAND GROWTH : 9.2% P.A. ELASTICITY : 1.5

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Development of Electricity Infrastructure GENERATOR Power PLANT INFRASTRUCTURE TRANSMITION Infrastructure DISTRIBUTION Infrastructure Technology SUPPORTED BY COMPONENT INDUSTRI INFRASTRUCTURE HUMAN RESOURCE

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL RENEWABLE ENERGY DEVELOPMENT

NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATIONAL NON-FOSIL ENERGY POTENTIAL NON-FOSSIL ENERGY RESOURCES EXISTING CAPACITY HYDRO 75.670,0 MWe 4.200,0 MW GEOTHERMAL 28.170,0 MWe 1.189,0 MW MINY/MICRO HYDRO 500,0 MWe 86,1 MW BIOMASS 49.810,0 MWe 445,0 MW SOLAR 4,8 kwh/m 2 /hari 12,1 MW WIND 9.290,0 MWe 1,1 MW URANIUM *) 34.112,0 ton - THORIUM *) 1.500,0 ton - MWe=Mega Watt equivalent

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL A Geothermal Power Plant

NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATIONAL ENERGY MIX 2025 (PRESIDENTIAL REGULATION NO. 5 YEAR 2006) Target in 2025 1. Less than 1 for energy elasticity 2. Optimized primary energy mix National (Primary) Energy Mix 2006 Hydro Power, 3.11% Geothermal, 1.32% Natural Gas, 28.57% Oil 51.66% Coal, 15.34% National (Primary) Energy Mix of 2025 (BaU Scenario) National Energy Mix 2025 (Presidential Decree No. 5/2006) Power Plant, 1.9% Mini/micro Hydro Power Plant, 0.1% Geothermal, 1.1% Gas, 20.6% Oil, 20% Gas, 30% BIOFUELS, 5% Oil, 41.7% OPTIMIZING ENERGY MANAGEMENT New & RE,17% Geothermal, 5% Biomass, Nuclear, Hydro Solar Energy, Wind Power, 5% Coal 34.6% Coal, 33% Coal Liquefaction 2%

NATIONAL ENERGY COUNCIL DEWAN ENERGI NASIONAL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL NATIONAL GEOTHERMAL POTENTIAL BY AREAS POTENTIAL TOTAL 28.170 MW; UTILIZATION TOTAL 1.189 MW. POTENTIAL RESERVE EXISTING AREA Speculatif Hipotetis Indicative Probable Proven CAPACITY (MWe) (MWe) (MWe) (MWe) (MWe) (MWe) Sumatra 4.975 2.121 5.845 15 380 12 Java 1.960 1.771 3.265 885 1.815 1.117 Bali 70 0 226 0 0 0 Nusa Tenggara 340 359 747 0 15 0 Kalimantan 45 0 0 0 0 0 Sulawesi 1.000 92 982 150 78 60 Maluku 595 37 327 0 0 0 Papua 75 0 0 0 0 Total 9.060 4.380 11.392 1.050 2.288 265 Locationi 13.440 14.730 1.189 Resources 28.170

NATIONAL NATIONAL ENERGY ENERGY COUNCIL COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL DISTRIBUTION MAP OF INDONESIA GEOTHERMAL POTENTIAL Maluku Sulawesi Kalimantan Irian Jaya Jawa Bali Alor Flores Quantity of geothermal distribution area in Indonesia: 265 areas Total Potential : 28,17 GWe 80 % associated with volcano environment 20% non volcano environment

NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL GEOTHERMAL DEVELOPMENT ROAD MAP (2008 2025) 958 MW 1442 MW 1158 MW 1400 MW 3500 MW EXISTING MINING WORK AREA EXISTING MINING WORK AREA EXISTING MINING WORK AREA + NEW NEW MINING WORK AREA NEW MINING WORK AREA

NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL GEOTHERMAL POWER PLANT ON 10.000 MW FAST TRACK PHASE II (2014) (MINISTERY REGULATION NO. 02 / 2010: ACCELARATION PROJECT TO DEVELOP POWER PLANT USING RENEWABLE ENERGY, COAL, AND GAS) AREA CAPACITY (MW) WEST JAVA & BANTEN 1195 CENTRAL JAVA 445 EAST JAVA 330 Sumatera 1767 Sulawesi 155 NTB, NTT, & Bali 50 Maluku 35 TOTAL 3977

NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL POLICIES AND REGULATIONS ON GEOTHERMAL FOR ELECTRICITY LAW NO. 27/2003 ON GEOTHERMAL GOVERNMENT REGULATION NO. 59/2007 To regulate the management and development of geothermal energy sources for direct and indirect utilization MINISTERY REGULATION NO. 32 / 2010 : CEILING PURCHASING PRICE OF GEOTHERMAL POWER PLANT BY PT. PLN (Persero) Ceiling purchasing price of electricity of geothermal power plant by PT. PLN is USD 9,7 sen/kwh MINISTERY REGULATION NO. 02 / 2010: LIST OF POWER PLANT PROJECT BASED RENEWABLE ENERGY, COAL, AND GAS Around Of 3977 MW Geothermal Power Plant

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL The Main Point of National Energy Policy (under Discussion) Sifting paradigm of viewing energy resource from as a commodity to be the development resources. improve fossil fuel proven reserve and reduce fossil fuel share in national energy MIX increase new and renewable energy share on national energy MIX launching efficiency, conservation, environment protection Programs improve independency in Energy management, creating employment, capacity Building and increasing domestic industry and service roles Equality access for all society to the Electricity and Fuel resources either in Rural area or in Urban area To secure the energy supply particularly electricity, fuel for short, middle and long term condition Optimizing energy resources usage, in national economic development ( tax, devisa, and Increase national competitiveness ) Simulation / projection of Energy demand, Energy Reserve and energy consumption, and energy flow as a based in considering national energy policy.

Emission (Gt CO2e).. NATIONAL ENERGY COUNCIL SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Mitigation Strategies Non-binding emission reduction target of 26% will be equal to 0.767 Gt. Reduce further to 41%, an additional emission reduction of about 0.422 Gt. Key source categories are peat emission, forestry, energy and waste 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 1.35 0.39 0.83 0.16 0.17 0.43 0.29 0.04 0.05 0.05 0.05 0.28 0.37 2.95 1.44 1.76 0.25 0.13 0.06 0.06 1.00 2000 2005 2020 2006 Peat Emission Waste Forestry Agriculture Industry Energy

SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL Prospect Cooperation in Energy Sectors Generation of Power Plant with new more Efficient Technology, Nuclear Power Plant, Renewable Energy: Solar, Mini Hydro, Geothermal, biomass, etc,

SEKRETARIS NATIONAL ENERGY JENDERAL COUNCIL DEN SEKRETARIAT JENDERAL DEWAN ENERGI NASIONAL THANK YOU