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Renewable energy and the new normal in Indonesia

While presenting plans for 2020, Minister for Energy and Mineral Resources (EMR), Minister Arifin Tasrif said the EMR sector is the largest contributor of Non-Tax State Revenue (PNBP).

The sectors consist of PNBP from Oil and Gas, Mineral and Coal, NRE, as well as other PNBP from Oil and Gas DMO, HR development services, education services, and R&D services organized by public service agencies (BLU) within the Ministry.

Arifin explains the EMR sector contributes Rp 172.9 trillion (US$ 11.8 billion) to the PNBP, or 81% of the Rp 214.3 trillion (US$ 14.6 billion) target.

Investment in the EMR sector in 2019 was US$ 31.9 billion or 96% of the target US$ 33.4 billion, consisting of investment in the oil and gas subsector US$ 12.5 billion; electricity US$ 12.0 billion; mineral and coal US$ 5.9 billion and NRE US$ 1.5 billion.

Investment in 2020 is set higher at US$ 35.9 billion.

Indonesia continues to search for extraordinary young innovators and entrepreneurs in the energy sector.

This initiative has received full support from the Ministry of Energy and Mineral Resources (ESDM) and is predicted to be an economic driver in the future, especially in accelerating innovation in new renewable energy (EBT).

Speaking at an Energy Solutions webinar in Jakarta, ESDM Ministry Expert Staff for Environment and Spatial Planning Saleh Abdurrahman said in the new normal has changed the energy landscape.

Development of fossil energy is becoming increasingly difficult – both to raise resources from multinational funding institutions and be sustainable.

Moreover, the transformation of EBT can change from a cost center to a profit center.

This change cannot be separated from the global dynamics that tend to experience a shift in energy consumption and the application of technology.

It was recorded that in the first quarter of 2020, the existence of Covid-19 was able to reduce world energy demand by 3.8% compared to the same period last year.

Rather than see this as a negative, this scenario should be used as an opportunity for the younger generation to seek new breakthroughs in the field of clean energy.

As businesspeople. energy entrepreneurs must be able to anticipate all possibilities. In the reduced demand, they must be able to find creative ideas to find breakthroughs in developing renewable energy.

For Indonesia, Saleh opined, one of the types of energy that can be cultivated and become the most prospective business fields in the future is solar photovoltaic (PV) and wind.

The two businesses were able to restore the level of confidence in energy investment, which according to the International Energy Agency (IEA) fell 20% in 2020.

On average, solar PV and wind will dominate the development of EBT technology going forward until 2040.

This condition is supported by the downward trend in renewable energy prices which is getting better from year to year.

The average world solar PV price of USD 250 per Mega Watt hour (MWh) in 2018 is now below US$ 100 per MWh and similarly, for wind.

The presence of EBT is expected to be able to fill opportunities in meeting energy needs, which are currently still dominated by fossil energy.

In the future, Saleh said that Indonesia will no longer be determined by large generators. In the event of a disruption, all of the public’s electricity supply will not be disrupted. This is called a small scale or distributed energy system.

The convenor of the webinar said the company is committed to continue to meet the world’s energy needs, increase economic growth, preserve the environment and have a positive impact on the surrounding community.

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