In 2007, the government established a specific legal basis for national energy management, with the adoption of Energy Law No. 30/2007 (EL7). The Law spells out general principles for the management of energy resources and the government’s basic targets for the future development of the energy mix. This Law recognises energy security as a critical national issue, and sets out to reduce dependence on imported refined oil while boosting the use of other energy sources, including natural gas, biofuels and geothermal resources. It is a comprehensive law that stresses the importance of sustainable development, environmental preservation and energy resilience in national energy management; it has laid the foundation for regulations on the development of renewable energy and energy conservation.
The Indonesian government has made significant efforts towards developing and implementing a National Action Plan on Climate Change Adaptation (RAN –API) which provides a framework for adaptation initiatives that has been mainstreamed into the National Development Plan. The goal of the climate change adaptation strategy is to reduce risks on all development sectors (agriculture, water, energy security, forestry, maritime and fisheries, health, public service, infrastructure and urban system) by 2030 through local capacity strengthening, improved knowledge management, convergent policy on climate change adaptation and disaster reduction, and application of adaptive technology.
National Energy Policy (Government Regulation No. 79/2014) (NEP14) introduces a number of important changes to energy policy planning. It focuses on re-establishing Indonesia’s energy independence by re-directing energy resources from export to the domestic market, and aims to rebalance the energy mix towards renewable energy supplies. This translates into minimising oil consumption, increasing the exploitation and consumption of renewables and coal, optimising gas production and consumption, and consideration of nuclear energy as the option of last resort.
NEP14 sets out the ambition to transform the energy mix by 2025 as follows: 30% coal, 22% oil, 23% renewable resources and 25% natural gas. The International Energy Agency points out that ‘the sheer challenge of this target becomes even more striking when translated into absolute figures. Use of gas is to more than double, use of coal is to more than triple, and renewables are to grow more than eleven-fold by 2025.’