INDEF Assesses Government's Electric Motorcycle Conversion Programme as Highly Beneficial if Successfully Implemented
The Institute for Development of Economics and Finance (INDEF) assessment of the government’s electric motorcycle conversion programme is seen as capable of providing efficiency and energy savings while promoting domestic industry growth.
INDEF Executive Director Esther Sri Astuti, contacted in Jakarta on Thursday, assessed that the policy to convert fuel-based motorcycles (BBM) to electric motorcycles with government subsidies is not only aimed at reducing emissions but also increasing energy efficiency and strengthening the components industry.
“In my view, conversion to electric motorcycles is far more energy-efficient and can reduce daily operational costs by up to 80 per cent or one-fifth of conventional fuel costs,” said Esther.
She added that to optimise the benefits of this programme, policy support needs to be expanded beyond purchase subsidies. INDEF urges the government to facilitate administration, including vehicle documents and annual taxes, as well as to increase charging infrastructure.
“Of course, this is not enough by just providing subsidies when buying the motorcycle but also handling documents, annual taxes, and not forgetting to provide more charging stations so that electric motorcycle users do not fear running out of power on the road,” she continued.
On the other hand, Esther noted that there are still challenges in implementing this programme, particularly the relatively slow conversion rate compared to the total motorcycle population in Indonesia. Additionally, equitable distribution of charging infrastructure remains a task that needs to be addressed immediately.
Nevertheless, she views this situation as opening up significant opportunities for the development of the local components industry. With the increasing demand for electric motorcycles, the domestic supply chain has the potential to grow and provide positive impacts on the national economy.
“However, this is a great opportunity to promote the local components industry,” said Esther.
Previously, the Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia stated that the government will form an energy transition task force (Satgas) to accelerate the implementation of the programme, including the conversion of conventional motorcycles to electric.
This was conveyed by Bahlil after attending a limited meeting (ratas) with President Prabowo Subianto at the Presidential Palace Complex, Jakarta, on Thursday (5/3).
He mentioned that the task force was formed to accelerate the conversion of conventional motor vehicles, numbering 120 million motorcycles, to electric.
“The President has formed a Satgas team to carry out this acceleration. And earlier, we were given the task by the President as the Head of the Satgas to carry out and translate it quickly,” said Bahlil.
The President, according to Bahlil, targets the implementation of the programme to run maximally within three to four years, even hoping it can be realised faster.