Summary: “Low Carbon Emission Development Strategy (LCEDS) in Indonesia
Energy Sector”, Scenario for 2020
by Retno Gumilang Dewi, Ucok Siagian, Rizaldi BoerBackground
This paper presents results of a study concerning Low Carbon Emission Development Strategy(LCEDS) in Indonesia Energy Development Scenario for 2020. In the same area, similar study has
been carried out for 2050 [Dewi, et.al. 2010]. Although LCEDS is usually intended to assess longterm vision, this study is applied for short-term scenario because it is intended to address options
for achieving reduction target in conjunction with National Action Plan for GHG Reduction (RANGRK). The national action plan is to meet GOI non-binding commitment to reduce the emission
26% below the 2020 baseline projection of Indonesian Second National Communication (SNC).
Power sector is discussed in more detailed in this study, as it is one of major contributor of theGHG emission and there is a new plan that intends to revise power development plan, i.e. morecoal compared to previous plan (RUPTL 2009-2018) in power sector will be deployed gradually by2020. The baseline of power sector in the SNC is projected based on the RUPTL 2009-2018. The
revision may alter the estimates of GHG emission level of the 2020 baseline of the SNC (Figure 1).
It is therefore considered necessary to investigate the impact of this revised plan, if implemented, tothe achievement of emission reduction target of energy sector set in RAN GRK and mitigation
actions need to be undertaken to achieve the target. Policy gap analysis and recommendation
relevant to the achievement of the RAN GRK target are also addressed in this study.
ObjectiveThe objective of the study is to describe future visions of Indonesia in achieving the goals of RAN
GRK as stated in the Presidential Regulation (PerPres) No. 61/2011. In addition, the document canalso provide overview of the impact of newly proposed (2012) revision of power sector plan to theachievement of the RAN GRK goal. Therefore, the document is critical for Indonesia and can beused as reference for decision maker in formulating development plans and policies, particularly
those that might affect to the achievement of GHG emission reduction target.
Approches and Methodology in Developing Scenario
The tool used in the development of LCEDS in this research is ExSS (Extended Snap Shot) using
GAMS (General Algebraic Modeling System) 23.3 supported by various current technical,economic and social parameters. Three scenarios are developed to envision Indonesia energy
development paths related to low carbon emission, namely business as usual (BAU) for 2020, two
mitigation scenarios, i.e. M1 for end user energy efficiency measures and M2 for combination ofend user efficiency measures and supply side efficiency measures (power generation and T&D
network). Another three scenarios also have been developed to investigate the effect of PLN
revised plan (higher coal share in PLN’s supply mix) to the BAU 2020 GHG emission level and thestrategies to address this effect, i.e. M1(R) consisting combination of end user efficiency measuresand supply side efficiency measures (power generation and T&D network), M2(R) comprising theM1(R)+change of transportation mode. Figure 2 presents the 6 scenarios scheme.
Results of The Scenario Development
From the analysis of these results of the LCDS simulation (Table 1 and 2), it can be concluded that: During the period of 2005-2020, the energy demand will increase 2.7 times (Figure 3) in linedwith the increasing of population (1.2 times) and GDP (2.6 times). The implication ofincreasing of the energy demand, CO2 emission will increase 3.3 times.
 The energy demand is projected to grow threefold from around 115 million toe in 2005 toaround 307 million toe in 2020 (Figure 4). In 2005 the share residential demand is comparablewith the share of demand from industry, transport and commercial. This situation is expected tochange in 2020 where the demand from industry and commercial will be higher than theresidential demand. As can be seen in Figure 4, the high energy demand is to be satisfied bydifferent types of primary supply, i.e. oil fuels, coal, natural gas, hydropower, geothermal andbiomass that highly dominated by oil in 2005. This situation is projected to change in 2020
where coal and natural gas would become comparable with oil share in energy mix. This occurs
1because the growth of electricity demand (supplied by coal and gas power plants) is higher thantransport sector (supplied by oil).
 Before plan revision, energy activities would generate 0.949 GTon of CO2 (2020). The national
GHG reduction target of energy sector is 0.038 Gton in 2020. The expected emission level after
implementing GHG reduction actions is 0.911 Gton CO2 in 2020. Under M1 scenario the GHG
would reach 0.914 Gton CO2 in 2020, which means this scenario could not meet the national
action plan on GHG reduction target. The reduction target could be achieved by implementing
M2 scenario. This scenario would result in emission level of 0.897 Gton in 2020 (see Figure 5).
This reduction is much higher than that expected to meet national target. This is intensionally
excercised to anticipate in case the efficiency measure at end-user side is not successfullymaterialized where effciency measures at supply side may be considered as the back up.
 If new plan is intended to increase more coal to replace oil power plant (higher coal power), theGHG in 2020 would become 0.975 Gton CO2 (see Figure 6), which is 0.028 Gton higher thanthe BAU baseline in 2020. The increase of GHG due to new revised plan (see Figure 6) wouldbe in opposite direction to the GOI commitment to reduce national GHG in 2020 by 0.038 Gton.
 Under “higher coal power” scenario, more reduction efforts have to be made to achieve theNational GHG reduction target in 2020. Combination of efficiency measures in end-user and insupply side, designated as M1(R), would not be sufficient to meet the national target. M1(R)scenario would result in emission level 0f 0.914 GTon CO2 in 2020. To achieve the target, theefficiency measures has to be added with shift of transport mode, designated as M2(R). ThisM2(R) scenario would result in emission level of 0.906 Gton CO2. This level is lower than thenational target (reduction of 0.038 GTon in 2020 from the baseline before PLN revision, whichis equal to the level of 0.911Gton CO2 in 2020 if the new plan is implementd).
“Higher coal in power” scenario
GHG Emissions level

Baseline

Revised reduction target

Reduction target
Emission level target (to meetgovernment emission reduction
commitment)

2005

2020

Figure 1 Effect of revised PLN plan to the GHG
that have to be reduced from the “highercoal in power” scenario

Figure 2. The schematic of the 6 scenarios ofthis Low Carbon Development
Strategy

Table 1. Simulation results of the effect of ‘higher coal power’ to the SNC scenariosParameter
GDP (trillion IDR)
Population (million)
Energy demand (million toe)
Energy demand per capita (toe)Energy intensity (toe/million IDR)
Energy Elasticity
CO2 emission (million ton-CO2)*
Carbon Intensity- Ton CO2 per capita- Ton CO2 per million IDR

2005
Base Year
1,787
219
115.3
0.5
63.6
290
3.6
208

2020 (SNC projection)
BaU
M1
M2
4,572
4,572
4,572
261
261261
307
299
299
1.2
1.1
1.1
67.2
65.3
65.3
1.06
1.03
1.03
949
915
897
3.6
208

3.5
200

3.4
196

Effect of higher coal in 2020
BaU
MR1
MR2
4,572
4,572
4,572
261
261
261
307.3
298.7
298.7
1.2
1.1
1.1
67.2
65.3
65.3
1.06
1.03
1.03
977
915
906
3.7
214

3.5
200

3.5
198

*It does not include CO2 emission from fugitives

2

Value of 2005 = 1

3.5
3.0
2.5
2.0
1.5
1.0
0.5
-2005

2020

Population

Energy_demand

Figure 3 Snapshots of ratio of population, GDP, energy demand, and CO2 emissions
future value (2020) as compared to the base year
Cement350

Iron and Steel300

Other Industries

250
200
150

450

Milion toe

Commercial

400

Million toe

450

50

Geothermal

Construction

250

HydroPower

Chemicals

200

Natural Gas

150

Oil

Mining and Quarying-

2005

2020BaU

Biomass

350
300

Textile, Wood, andPaper
Food and Beverage

100

400

Agriculture100

Coal50-2005

2020BaU

Figure 4 Final energy demand and primary energy supply projection for BAU scenario (2020)
1,000

Power Generation

911

Tertiary Industries

900

Power Generation

1,000

911

Tertiary Industries

Cement900

800

Iron and Stel800Iron and Stel

700

Other Industries

700

Other Industries

600

Construction

600

Construction

Chemicals

500

Textile, Wood, andPaper
Food and Beverage

400

CementChemicals

500

Textile, Wood, andPaper
Food and Beverage

400

300

Mining and Quarying

300

200

Agriculture200

Mining andQuarying
Agriculture

100

Households

100

Households-Freight transport

2005

2020BaU 2020M1 2020M2

Passenger transport

Figure 5 CO2 (million ton) under Bau and mitigation
scenarios (M1 and M2) in 2020

0

Freight transport
2020BaU

2020BaU 2020 M1(R)2020 M2(R)Passenger transport
Higher Coal

Figure 6 CO2 (million ton) for BAU (SNC) andhigher coal scenario: BaU, M1(R) , M2(R) in 20203