Thu, 27 May 2010

From: The Jakarta Globe

By Reva Sasistiya
Indonesian officials acknowledged on Wednesday that much work remained to be done to reduce obstacles to investment in the country’s clean-energy sector, but also touted recent efforts to support development, especially of geothermal energy, and affirmed the government’s commitment to the use of clean energy in the future.

Amir Sambodo, a deputy to the coordinating minister for the economy, said more investment incentives were needed, especially to promote the development of solar, biofuels hydropower and wind power. Government was also focused on developing the necessary technology, he said.

However, Amir said the government had made efforts in recent years to attract investment.

“We have offered fiscal incentives, including tax cuts and subsidies for bio-energy development,” Amir said. “For geothermal power, we have agreed to give pay a maximum of 9.7 cents a kilowatt hour for geothermal electricity and it has attracted investor interest domestically and from overseas.”

Luluk Sumiarso, special staff to the energy minister, said the government should offer more incentives, while pointing out the government had set a goal of getting 25 percent of total energy consumption come from renewable sources by 2025. Much of the focus was on developing the necessary expertise, Luluk said.

“Indonesia still has only limited knowledge of renewable energy. We are heavily dependent on technology from developed countries.”

Fabby Tumiwa, an energy analyst with the Institute for Essential Services Reform, said the government should establish a renewable-energy fund to provide grants or interest-free loans to firms developing the technology.

“Companies or individuals could apply to the fund. It could be for scientific and technological research, construction of renewable energy projects, surveys, assessment of renewable energy resources, or localized production of the equipment for the development of renewable energy,” he said.

Indonesian Democratic Party of Struggle (PDI-P) lawmaker Ismayatun, a member of the House of Representatives Commission VII overseeing energy, said the government needed to simplify regulations and set up a one-door policy to attract energy companies to invest in Indonesia.