RI oil, coal reliance seen rising

RI oil, coal reliance seen rising

Agence France-Presse, Osaka, Japan

Indonesia's primary energy demand is expected to rise by 3.5 percent a year until 2030 with gas demand increasing with the country's reliance on oil and coal showing signs of easing.

According to the World Energy Outlook, which appears every two years by the International Energy Agency (IEA), demand for gas will grow at 3.4 percent, and coal by 5.2 percent a year.

It said oil would continue to dominate Indonesia's primary fuel mix but its share would fall from 54 percent in 2000 to 43 percent in 2030.

The 521-page global report, released here at the International Energy Forum, noted electricity companies had received government subsidies since the economic crisis first struck in 1997.

"Energy prices in Indonesia are still heavily subsidized, although recent reforms imposed by the International Monetary Fund (IMF) have reduced the subsidies on oil products and oil," it said.

It note a World Bank report that stated domestic prices for basic petroleum products were on average 43 percent of the international price in 2000.

But it found demand for energy will ease.

"A shift of industrial structure to lighter manufacturing, the use of more efficient equipment in end-use sectors and the rise in energy prices as subsidies are removed will contribute to this trend," it said.

Robert Priddle, executive director of the Paris-based IEA, said the report was the IEA's most ambitious, projecting energy supply, demand, prices, trade and carbon emissions from now until 2030.