INDONESIA ENERGY OUTLOOK TOWARD SUSTAINABLE ENERGY DEVELOPMENT By: DR. Tumiran

Transcription

1 NATIONAL ENERGY COUNCIL INDONESIA ENERGY OUTLOOK TOWARD SUSTAINABLE ENERGY DEVELOPMENT By: DR. Tumiran The Board Member of The National Energy Council of Indonesia Board Expert Chair, Indonesia Smart Grid Association Expert board member, Indonesia Electricity Association Board Expert of Indonesia Electricity Magazine, Dean of Engineering Faculty, Gadjah Mada University ( ) Bali Energy Forum Denpasar, BALI, Indonesia, 19-20, NOVEMBER 2015

2 ENERGY, ECONOMIC & SUSTAINABLE DEVELOPMENT 1

3 EFFECT OF ENERGY TO ECONOMY Ideally, economic growth requires a slight increase in energy consumption, but nevertheless energy consumption volume will still rise. Index, 1980 = Real GDP Energy Used Souce : BP Energy Outlook, 2014 & GDP Forecast, Wood Mackenzie,

4 Energy and the Development, transformation and economic added value, creating Jobs ENERGY SUPPLY ENERGY TRANSFORMATION ENERGY DEMAND Exploration, exploitation Renewable Oil Gas Coal Refining Power Plant feedstock Industry Transportation Commercial Household Creating new job INFRASTRUCTURE Financing Human Resources TECHNOLOGY ENERGY OTHER INPUTS Added Value: ECONOMIC OUTPUT 3

5 Balance of Security, Economy and Environment Sustainability of Energy Security The selection of energy sources depend on: -energy resources Pricing Sustainability of supply Characteristic supply needed Distribution area, Environmental consideration Political decision GDP of the country Economy Continuity/ Energy Efficiency Gas, Renewable, and Nuclear Environment and Low Carbon Sustainability 4

6 WORLD ENERGY DEMAND & GEOPOLITICS 5

7 Primary energy demand, 2035 (Mtoe) China is the main driver of increasing energy demand in the current decade, but India takes over in the 2020s as the principal source of growth Non-OECD Asia Share of global growth % 10% Middle East 8% Africa 8% 5% Latin America Eurasia 4% OECD United States Gas Coal Brazil Europe Africa Middle East Eurasia India China Growth in global energy demand 440 Japan Southeast Asia (Indonesia 36%) Renewables Fossil Fuel still become main resources to full fill the world energy demand Today's share of fossil fuels in the global mix, at 82%, is the same as it was 25 years ago; the strong rise of renewables only reduces this to around 75% in 2035 Oil Nuclear Mtoe Source: World Energy Outlook, IEA,

8 Dec, 2014 Jan 30, 2015 Feb 27, 2015 Mar 30, 2015 DEWAN ENERGI NASIONAL US$/Bbls 120 Status: 30 March 2015 CRUDE OIL PRICE How Low Can You Go (inflation adjusted using CPI in November 2014) Middle east geopolitics Geopolitics: Israel - Arab war, the Iranian revolution, the Iran- Iraq war Increasing demand Limited supply Geopolitic Natural disasters Speculator Falling Value of the US $ Economic recession Over supply additional non-opec production Incresing on shale oil production, Demand stagnant, Speculator, OPEC quota production - Arabian Light posted at Ras Tanura WTI Spot Price FOB Europe Brent Spot Price FOB Source: BP Statistical Review 2014; EIA 2015, InflationData.com 2015 reprocessed by DEN; 7

9 LESSON LEARN FROM DEPENDENCY ON FOSSIL ENERGY Petroleum dominate the world's primary energy mix by 2050 and almost all oil and gas resources located in the Middle East & Central Asia. This makes the Middle East & Central Asia is the areas that are sensitive to conflict Middle East geopolitical situation becomes one of the basic factors that increase in world oil and gas prices scarcity? Increasing demand in non OECD Asia Countries, make this region have important role in competition in the fulfillment of the energy supply increase in geopolitical tensions in the region? Volatility in oil price drive by several factor such us oil production (conventional & unconventional oil), oil demand, oil stock, speculation in oil trading, and geopolitics. The lower oil price have positive impact that many countries start to reform the energy pricing (reduce energy subsidies). But if there is no policy breakthrough, we will face the problem of dependence on oil and the development of renewable energy will be ignored Therefore: Diversification consumption of fossil fuels to fuel non-petroleum needed to ensure energy security world Potential non-fossil energy (renewable energy) is more spread out in almost all countries (quality and number could be different) 8

10 INDONESIA ENERGY OUTLOOK 9

11 BASIC ASSUMPTIONS The projections cover the period of with 2013 used as the base-year. Indonesia's economic growth target of an average of 8% per year in 2020, and 7.5% in 2030 and becomes 6.3% in The population growth rate is above 1% until 2020, slowing to 0.8% in 2030 (BPS) and becoming 0.6% in 2050 (KEN - NEP). Urbanization growth follows the projections released by BPS (Central Statistics Agency), where the percentage of the population living in urban areas accounts for 52% by 2013, and 64% in 2030, then rise to 70% in Electrification ratio is set to be close to 100% in 2020 (KEN - NEP). Energy reserves only include proven reserves and potential. For KEN (NEP) scenario, have considered the use of high efficiency technology, that will affect the energy per capita. 2 10

12 INDONESIA OIL AND GAS RESERVES 6,93 6,93 150,68 150,68 1,20 1,22 109,05 110,67 50,48 50, , ,67 373,23 373,23 18,30 18,32 14,63 14,63 573,5 573,5 2,58 23,9 2,58 23,9 51,87 51,87 65,97 65, , ,07 3,18 494,89 5, ,03 15,21 7,48 15,21 OIL RESERVES (MMSTB) PROVEN = 3.692,49 POTENTIAL = 3.857,31 TOTAL = 7.549,81 GAS RESERVES (TSCF) PROVEN = 101,54 POTENTIAL = 48,85 TOTAL = 150,39 Source: MEMR, 2013, reprocessed by DEN 4 11

13 COAL RESOURCES Source: MiEMR, 2013, reprocessed by DEN Low Rank Medium Rank High Rank Very High Rank (> 5,100 kal/gr ADB) (5,100-6,100 kal/gr ADB) (6,100-7,100 kal/gr ADB) (< 7,100 kal/gr ADB) Resources: 120,53 billion Ton Reserves : 31,36 billion Ton 5 12

14 FINAL ENERGY CONSUMPTION OF INDONESIA, 2013 Electricity 7,7% Oil Product 24,8% Gas 24,2% Biomass 8,61% Coal 34,74% LPG 3% Fuel 17% Electricity 76% INDUSTRY Fuel 97,8% Total Consumption: 134 MTOE Gas 4% LPG 46,0% COMMERCIAL Kerosene 6,4% Biomass 0% Gas 0,1% Electricity 47,5% TRANSPORTATION Gas 0,1% Electricity 0,0% Biofuel 2,1% RESIDENTIAL Source: Ministry of EMR 2013, processed by NEC The remainder is consummed by other sector 3 MTOE (3%). 6 13

15 Million Barrel DEWAN ENERGI NASIONAL OIL PRODUCTION, IMPORT AND EXPORT % % % % 33% 35% 30% 36% 32% 33% 32% 39% 40% % Produksi Production Ekspor Import Impor Export Rasio import Import dependency ratio 0% Source: MEMR, 2013, reprocessed by NEC Note: Import dependency ratio = Import / Domestic Consumption 7 14

16 ribu MMSCF DEWAN ENERGI NASIONAL NATURAL GAS PRODUCTION AND EXPORT 4,000 3,500 3,000 2, % 90% 80% 70% 60% 2,000 1,500 45% 49% 47% 46% 48% 46% 41% 44% 43% 39% 43% 50% 40% 1,000 30% 20% % Produksi Production Ekspor LNG Export LNG Ekspor Export by Pipa Rasio Export Ekspor Ratio pipeline 0% Source: MEMR, 2013, reprocessed by NEC Note: Export Ratio= Export/ Production 8 15

17 Million TON DEWAN ENERGI NASIONAL COAL PRODUCTION AND EXPORT % % 73% 73% 74% 75% 78% 78% 76% 81% 81% 85% 80% % % % % Source: MEMR, 2013, reprocessed by NEC Note: Export Ratio= Export/Production Production Export Domestic Export Ratio 9 16

18 ENERGY MIX TARGET TO 2050 NRE Oil Gas Coal a. Consume of gas increase b. Consume of coal increase c. Consume of oil increase d. Contribution of RE Increased 30% 23% 2,500 Kwh/ Cap. 22% 25% Energy Total: 400 MTOE Power Plant: 115 GW Energy Consumption: 1.4 TOE/cap Electricity Consumption: KWh/cap Energy Total: 194 MTOE Power Plant: 51 GW Energy Consumpt: 0.8 TOE/cap Electricity Consumpt: 776 KWh/cap 31% 5% 18% 46% Energy Total: MTOE Power Plant: 430 GW Energy Consumption: 3.2 TOE/cap Electricity Consumpt: KWh/cap 25% 7,000 Kwh / Cap. 31% 20% 24% 17

19 Electricity Sector Need Investment : power plant, transmission power line, power distribution line, substation Opportunity: international cooperation, to Boost domestic industry growth Power Plant: 53 GW Electricity Consumption: 800 KWh/cap Power Plant: 115 GW Electricity Consumption: KWh/cap Power Plant: 430 GW Electricity Consumpt: KWh/cap 35 GW Target to be reached To accelerate Creating domestic market for : Coal, Gas, renewable energy Industrial Growth: Creating Jobs National Competitiveness 18

20 Million TOE DEWAN ENERGI NASIONAL FINAL ENERGY DEMAND PROJECTION BY TYPE OF ENERGY NRE Electricity Coal Fuel Gas Base BaU KEN BaU KEN BAU KEN BaU KEN BaU KEN BaU KEN 81% Note: Exclude traditional biomass Source: NEC Calculation 12 19

21 FINAL ENERGY DEMAND GROWTH BY SECTOR (BaU) Note: Exclude traditional biomass Source: NEC Calculation 20

22 FINAL ENERGY DEMAND GROWTH BY SECTOR (KEN) Note: Exclude traditional biomass Source: NEC Calculation 21

23 Terrawatt-Hour DEWAN ENERGI NASIONAL ELECTRIC POWER SUPPLY PROJECTION 2,500 2,000 1,500 Others RE Solar PP Hydro PP Gas PP Biofuel PP Geothermal PP Diesel PP Coal PP 1, BaU 3 KEN 4 5 BaU 6 KEN 7 8 BaU 9 KEN BaU 12 KEN BaU KEN BaU KEN

24 Gigawatt Gigawatt Gigawatt DEWAN ENERGI NASIONAL POWER PLANT CAPACITY S K E N A R I O B a U NRE 14,3% NRE 13,4% S K E N A R I O K E N NRE 46,3% NRE 47,2% NRE 16,6% NRE 12,9% NRE 18,0% NRE 18,8% NRE 17,9% NRE 12,9% NRE 35,2% NRE 40,6% NRE 43,3% NRE 45,2% Coal PP Gas PP Diesel PP Hydro PP Geothermal PP Solar PP Biofuel PP Others RE 16 23

25 MTOE DEWAN ENERGI NASIONAL PRIMARY ENERGY SUPPLY PROJECTION 1,400 1,200 NRE Oil Gas Coal 1, BaU KEN BaU KEN BaU KEN BaU KEN BaU KEN BaU KEN

26 MTOE DEWAN ENERGI NASIONAL FINAL ENERGY SAVING POTENTIAL (If KEN be performed consistently) ,8% ,9% ,8% ,1% - 22,4% - 26,4% BaU 2 KEN BaU 6 KEN BaU 10 KEN BaU 14 KEN BaU 18 KEN BaU 22 KEN Industry & Transportation Household Commercial Other Sector Total raw material 23 25

27 MTOE DEWAN ENERGI NASIONAL CHANGES IN PRIMARY ENERGY SUPPLY (If KEN be performed consistently) 1,400 1,200-21,0% 1, ,4% 400-9,2% - 46,9% 117,8% BaU 2 KEN BaU 6 KEN BaU 10 KEN BaU 14 KEN BaU 18 KEN Coal G a s O i l N R E Total 24 26

28 Million Ton CO2 Equivalent DEWAN ENERGI NASIONAL CO2 EMISSION REDUCTION POTENTIALS (If KEN be performed consistently) 4,000-42,5% 3,500-43,6% 3,000 2,500-40,7% 2,000 1,500 1,000-17,1% - 28,1% - 35,2% BaU 3 KEN 4 5 BaU 6 KEN 7 8 BaU 9 KEN BaU 12 KEN BaU 15 KEN BaU 18 KEN

29 MTOE DEWAN ENERGI NASIONAL CRUDE OIL AND FUEL OIL IMPORTS (If KEN be performed consistently) Fuel Oil & Other Petroleum Product Crude Oil BaU KEN BaU KEN BaU KEN BaU KEN BaU KEN BaU KEN

30 Juta TOE MTOE DEWAN ENERGI NASIONAL LPG AND NATURAL GAS IMPORTS (If KEN be performed consistently) 25 Imports of LPG Imports of Natural Gas BaU KEN BaU KEN

31 MTOE DEWAN ENERGI NASIONAL BIODIESEL DEMAND (If KEN be performed consistently) 70 BaU KEN

32 MTOE DEWAN ENERGI NASIONAL BIOETANOL DEMAND (If KEN be performed consistently)

33 Indonesia Energy Policy Reform To guaranty and secure the environment sustainability Reduce export of fossil resources Independently in the whole energy management Creating job in energy sector and added vale sector Improve Energy security and resilience To Guaranty availability of energy Develop human resource, technology and boost domestic industry Fulfillment access energy to all the people (especially for poor people) Optimizing energy management, integrated and sustain Optimizing the use of energy in all sectors 32

34 POLICY REFORM ON FOSSIL ENERGY Enhance exploration of energy resources Reducing export of fossil energy gradually especially gas and coal and setting a limit of time to start disabling export Achieving the balance between the rate of increase of fossil energy reserves with allowable maximum production rates Minimizing the use of petroleum Ooptimizing natural gas utilization utilizing petroleum only for transport and commercial, which can t be replaced by other sources of energy Uutilizing natural gas for industry, electricity, household and transportation Developing energy buffer stock to improve energy security Aaccelerating the implementation of fuel oil substitution by gas in the household and transport sectors Accelerating the provision of infrastructure facilities for production, refining, transportation and distribution of energy Applying depletion premium used it for renewable energy development 33

35 POLICY REFORM ON ENERGY PRICING AND SUBSIDY Energy pricing and subsidy policy, include : Energy price is set based on the economic value and fairness. Regulating the electricity market through: Setting primary energy prices for power plant (specifically for coal, gas, hydro, and geothermal); Setting electricity tariff progressively ( is being discussed) ; the Government and local government authorities have a responsibility to provide subsidies, with the following considerations: the purchasing power of the public is still low; the price of renewable energy is more expensive than nonsubsidized oil fuel prices Subsidies only for the poor people; subsidies reduction on fuel and electricity is implemented gradually. 34

36 POLICY REFORM ON RENEWABLE ENERGY To encourage the utilization of Renewable Energy by: Iimplementing feed-in tariff for renewable energy; Fiscal and non fiscal incentive to stimulate energy diversification and renewable energy development Regulating the renewable energy market, among others: Setting minimum quota of electric power from renewable energy sources; Setting liquid and gas fuel sourced from new and renewable energy Setting the renewable energy price based on the following : to compete with energy price of petroleum; to calculate a rational energy prices by taking into account the local renewable sources. 35

37 RENEWABLE ENERGY DEVELOPMENT BARRIERS 23% in 2025 Governence Socio-culutural Limited public awareness of renewable energy technologies Lack of coordination and consistency in policy R&D Inadequate investment in technical research and development for renewable energy Financing There is a high initial unit cost of equipment and maintenance, tax & incentive problems 36

38 WHAT FORMS OF COOPERATION NEEDED to BOOST IMPLEMENTING of RE 23% in 2025 INDONESIA RENEWABLE ENERGY GOAL Government efforts to achieve the goal One Door One Stop Permit Policy Financing scheme Fiscal insentive Tax policy Campaign R&D etc Lesson learned from best practices Hydro Biofuel Waste to energy INTERNATIONAL SUPPORT Transfer technology Geothermal Tidal Energy Solar PV Wind Energy Capacity Building Financing support/investment Local business /community /university Energy efficiency & conservati on Foreign investors /consultants /community /university 37

39 Thank You 38