Greetings from Rio as power crisis looms

Greetings from Rio as power crisis looms

The Jakarta Post, Jakarta

For Indonesia there is perhaps no better example of the
urgency of sustainable development than the energy sector.

The country is on the brink of a power crisis 10 years after
it promised energy sustainability as part of the 1992 Rio
declaration.

"The fact is that it (conservation) hasn't work," said Achmad
Safruddin of the Indonesian Forum for the Environment Forum
(Wahli) and the chairman of a government-sponsored team to phase
out the use of leaded fuel.

Over the past decade Indonesia's economy has gone from boom to
bust, but energy consumption here has more than doubled during
this period. Energy consumption has been growing by 8 percent to
10 percent per year.

Indonesia pledged to promote energy efficiency when it took
part in the 1992 Earth Summit in Rio de Janeiro, Brazil.

Under the Rio declaration, the government is committed to
implementing the principles of sustainable development.

A second summit will take place in Johannesburg, South Africa,
from late August to September. Preliminary meetings for the
summit are underway in Bali until next month.

As host for the final round of pre-summit talks, Indonesia's
own progress toward sustainable development in the energy sector
has been minimal.

The country now faces a power crisis even as its laggard
economy is muting demand for energy.

State electricity company PT PLN has warned that power demand
may outstrip supply next year. By then peak demand will likely
hit 15,441 megawatts (MW), compared to a capacity of 15,285 MW.

A widespread power shortage would stall the already frail
recovery of the economy, hurting the manufacturing sector and
employment here.

The immediate government response has been to call for
increases in power generating capacity across the country.

This would call for extra funds of some US$28.45 billion over
the next 10 years, according to government data.

A tight state budget means that most of the investment in new
power plants will have to come from private funds.

But Indonesia's battered power sector is a disincentive and
efforts to restructure it advance too slow for new power plants
to come onstream, analysts have said.

The outlook in the oil sector is less gloomy, but consumption
is more wasteful.

Fuel oil has long been a favorite energy source, and
Indonesians were pampered with three decades of generous
subsidies on fuel oil.

Transportation is the biggest culprit, making up an average of
50 percent of the country's total fuel consumption. Industries
and PLN follow with about 20 percent and 10 percent respectively
of the country's total fuel consumption.

The Indonesian Consumers Foundation (YLKI) warned that if fuel
consumption continues at the current rate, Indonesia will be out
of oil in 20 years.

Recent oil discoveries and new oil recovery techniques,
however, likely would push that date back several years.

Still, government data shows that for every $1 million in
goods and services produced, Indonesia consumes on average 48
percent more energy compared to developed countries.

"We are now trying to take on energy conservation efforts from
the supply and demand side," said Luluk Sumiarso, the director
general for electricity and energy development at the Ministry of
Energy and Mineral Resources.

On the supply side, he said, renewable energy like wind, solar
and geothermal have priority in the construction of power plants.

Saving opportunities are high on the demand side as well.
Indonesians use some 200 million light bulbs a year that consume
five times the amount of energy that fluorescent lights require.

Luluk said a government-sponsored program encouraged people in
the lower income brackets to use fluorescent lamps by offering
them the chance to pay for the more expensive lamps on
installment.

But where the energy conservation campaign fails to cut back
national fuel oil consumption, higher prices must do.

The government plans to stop subsidizing fuel oil by 2004 and
prices now hover at 75 percent of market levels.

With fuel oil becoming more expensive, more industries have
switched over to alternative sources of energy, with natural gas
being in demand.

Wahli's Achmad said this development was still a long way from
the principles set out under the Rio declaration.

"Indonesia has fallen short of the Rio declaration three
times," he said, referring to a lack of progress in energy
conservation, diversification and the use of cleaner energy
sources.

Principle eight of the declaration stipulates that countries
should eliminate unsustainable patterns of production and
consumption.

To put an end to Indonesians' habit of wasting energy, the
government employs a staff of three people with no budget.

The failure to come out in full support of the Rio declaration
has landed the energy sector in its current predicament, Achmad
said.

He noted that Indonesia's 20-year-old national energy policy
had the tools to tackle these issues, but were useless without
regulations.

"The energy policy as a concept will never be of any good
unless the government can enforce it to the public," he said.

Blocking the move from theory to practice are a multitude of
interest groups within and outside the government.

"People who sell energy want demand to rise ... and
conservation cuts demand," Achmad said.

The government may be facing another test of wills as it gears
up for two weeks of talks in Bali on sustainable development.