Govt promotes use of money-saving alternative energy sources
Govt promotes use of money-saving alternative energy sources
Urip Hudiono, The Jakarta Post, Jakarta
The government hopes to be able to save some Rp 50 trillion
(about US$5 billion) in annual fuel subsidy spending in years to
come by developing alternative energy sources such as coal,
natural gas and bio-mass fuel.
For this, the government has marked out a roadmap for the
increased use of alternative energy sources in the country over
the next five years, and will issue the necessary regulations and
provide additional funding for the relevant ministries to support
the program.
Coordinating Minister for the Economy Aburizal Bakrie said
during a hearing on Monday with the Regional Representatives
Council (DPD) that such savings would be achievable due to the
economic efficiency of the alternative energy sources, apart from
their long-term benefits in terms of energy conservation and
energy security for the whole nation.
"Such benefits for the country's fiscal position are only from
the savings we will gain from reduced fuel consumption. The
central government and local administrations will also benefit
from additional tax revenues, royalties and dividends from the
increased production of such non oil-based fuels as gas and
coal," he said.
"The use of domestic natural gas from marginal fields for
electrical power generation, for example, could generate up to Rp
400 million for the regions."
Aburizal explained that the use of alternative energy was now
more crucial than ever before, pointing out how losses in the power
sector alone from the use of oil-based fuels amounted to Rp 7
trillion each year.
The government has allocated Rp 89.2 trillion for fuel
subsidies this year, and Rp 68.5 trillion for next year.
A study from the Office of the Coordinating Minister for the
Economy shows that the use of 3.5 million tons of coal briquettes
to replace kerosene for household use could save up to 2.45
kiloliters of kerosene, which is the equivalent of between Rp 7.8
and Rp 11 trillion. The use of alternative fuel from coal
liquification could further add to these savings, but only if it
reaches an economic price when crude oil prices are at $35 a
barrel.
Meanwhile, the use of bio-mass fuel -- such as biodiesel -- to
replace just 10 percent of fuel consumption in the transportation
sector could save up to 1.2 million kiloliters of oil-based
fuels, or Rp 5.1 trillion, each year.
The use of compressed natural gas to replace between 10 and 20
percent of transportation fuel usage would also save a total of
8.4 million kiloliters of oil-based fuels, or 28.8 trillion.
In the roadmap, the government plans to increase the use of
alternative energy, such as coal, natural gas, hydro power, and
geothermal power, for electric power generation to 97 percent,
from 78 percent at present, while reducing dependency on oil-
based fuels.
"We have also set up task forces that include the research,
agriculture, industry and energy ministries to support these
developments and encourage the widespread use of bio-mass fuels
from crude palm oil and jarak oil," Aburizal said.
"The government's decision to hike fuel prices this year could
also be considered as laying the foundations for encouraging the
use of alternative energy."