JAKARTA \u2013 Geopolitical tensions in the Gulf region between Iran, the\nUnited States, and Israel are not only sparking global concerns but also\nopening opportunities for Indonesia to accelerate major steps in the\nenergy sector, particularly electrification.<\/p>\n
Constitutional Economist Defiyan Cori assesses that the conflict\nsituation could serve as a momentum for the government to expand\nelectricity-based energy policies while reducing dependence on imported\nfossil fuel imports.<\/p>\n
\u201cThe war in the Gulf region has the potential to disrupt global\nenergy distribution routes, especially through the Strait of Hormuz,\nwhich is one of the world\u2019s main oil shipping lanes. Disruptions on that\nroute are feared to impact Indonesia\u2019s energy supply, which still relies\non oil and gas imports,\u201d he stated in a written release on Wednesday\n(1\/4\/2026).<\/p>\n
According to Defiyan, this condition poses a serious challenge for\nthe government in maintaining national energy resilience, especially\namid the energy self-sufficiency target set by President Prabowo\nSubianto.<\/p>\n
Burden of Energy Subsidies Continues to Swell<\/strong><\/p>\n Data shows that Indonesia\u2019s energy subsidy allocations have\ncontinuously increased in recent years. In 2021, energy subsidies were\nrecorded at Rp 131.5 trillion, up from Rp 95.7 trillion in 2020.<\/p>\n In 2022, the realisation of energy subsidies rose to Rp 157.6\ntrillion, then increased again to Rp 159.6 trillion in 2023, with the\nlargest portion used for subsidies on imported fuel oil (BBM) and 3 kg\nLPG.<\/p>\n In 2024, the energy subsidy allocation reached Rp 203.4 trillion,\nwith Rp 114 trillion of that for BBM and 3 kg LPG subsidies.<\/p>\n \u201cIn the 2026 RAPBN, the government has again allocated energy\nsubsidies of Rp 210.06 trillion, including Rp 105.4 trillion for BBM and\nLPG subsidies,\u201d he added.<\/p>\n Push to Shift Subsidies to Electrification<\/strong><\/p>\n Defiyan assesses that the large allocation of fossil-based energy\nsubsidies needs to be evaluated, especially amid rising global\ngeopolitical risks.<\/p>\n He urges the government to begin shifting some subsidies from\nimported BBM and LPG to electrification programmes, such as electric\nstoves and electric vehicles, to strengthen national energy\nresilience.<\/p>\n As a note, President Prabowo Subianto has previously expressed\ncommitment to accelerating the transition to new and renewable energy\nthrough the national electrification programme, including the\nconstruction of a 100 gigawatt Solar Power Plant.<\/p>\n The programme is also aimed at increasing the electrification ratio\nin remote areas and supporting the development of the electric vehicle\necosystem.<\/p>\n Defiyan stated that electrification policies need to be supported by\nchanges in subsidy patterns so as not to merely become a short-term\nresponse to geopolitical conflicts.<\/p>\n He also suggested expanding electrification incentives for the\npublic, particularly low-income groups, to make the transition process\nfaster.<\/p>\n \u201cIn addition, the government needs to carry out pilot projects in\nseveral regions to accelerate the migration of energy use from BBM and\nLPG to electricity. Socialisation and education for the public are also\ndeemed important to increase acceptance of electricity use,\u201d he\nconcluded.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/iran-us-israel-conflict-spurs-push-to-accelerate-indonesias-electrification-1775029868",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}