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Challenges and Opportunities: Encouraging Equal Access to Electricity in Indonesia

Alvin Sisdwinugraha

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Jakarta, August 22, 2023 – Indonesia, as an archipelagic country with various geographical and demographic conditions, faces complex challenges in realizing equal access to electricity for all its residents. Despite significant progress in the energy sector over the past few years, the national electricity grid still needs to cover many remote and inland areas. In facing this challenge, the government is responsible for bridging the electricity access gap to provide economic and social benefits to all citizens.

Deon Arinaldo, Manager of the Energy Transformation Program IESR, explained equity in access to electricity and electricity quality is by the national energy policy, namely PP 79 of 2014, which clearly states that the national energy policy aims to create national energy security and independence. One of the priorities in the KEN is prioritizing energy development and utilization of existing resources in the country for communities or parties who do not have access to energy, be it electricity or others.

“For that, we need a proven strategy. For example, developing an isolated off-grid African system is not connected to a large network. Still, it is built specifically to electrify a certain area, utilizing the renewable energy available. However, this strategy certainly has advantages and disadvantages. Access to electricity should have the spirit of not only providing access to electricity but also how access to electricity can provide opportunities for people who get access to improve their quality of life and boost the economy in the region,” said Deon Arinaldo in the webinar Road to IETD: Energy Transition in Equality of National Electrification.

Alvin Putra Sisdwinugraha, Electricity System and Renewable Energy Analyst IESR mentioned the electrification ratio is unable to answer questions related to accessibility, reliability, as well as capacity, and quality. For this reason, it is necessary to use the Multi-Tier Framework (MTF), which is a spectrum of service quality from the point of view of end-users.

“For example, IESR has conducted MTF assessments in West Nusa Tenggara (NTB) and East Nusa Tenggara (NTT), and the results are still limited to Tier 1-2, namely electricity is not available for 24 hours and is limited. So an evaluation method is needed to integrate the quality of electricity service as a key indicator of achievement related to energy access. This requires coordination between institutions such as the Ministry of Energy and Mineral Resources, PLN, the Ministry of Villages, and the Regional Government/Provincial Government,” said Alvin. ‘

Reflecting on this, said Alvin, IESR is trying to push the paradigm “Beyond 100%,” where access to electricity and energy is not only seen from the electrification ratio. However, there needs to be a paradigm shift in providing access to power, which is reflected in the energy development plan. The energy in question is for fair and equal development for all people.

Rachmat Mardiana, Director of Electricity, Telecommunications and Informatics, Ministry of National Development Planning/Bappenas stated, with Indonesia’s desire to reach a developed country or get out of the middle-income trap, meeting electricity needs is also a challenge in the direction of regional development in every island in Indonesia. If you look at the territorial issue of electricity, the geographical conditions of Indonesia, which is an archipelagic country spread across, pose a challenge to providing good electricity services. For this reason, several transformative efforts in electricity can be carried out, such as accelerating the energy transition, reforming subsidies, and increasing the efficiency of electricity utilization.

“Efforts to electrify Indonesia are also inseparable from the potential for renewable energy in Indonesia, such as solar, hydro, bioenergy, wind, geothermal, and sea. This is also supported by reduced investment costs so that it can be implemented in remote areas. Collaborative efforts are needed between the government, the community, BUMN, and experts to carry out national electrification equity. Bappenas, together with the Asian Development Bank (ADB), has developed a model to electrify eastern Indonesia, such as Maluku, Papua, and Nusa Tenggara, whose data sources come from satellite imagery. The main goal is to reduce the required initial investment costs, “said Rahmat.

Marlistya Citraningrum, Manager of the Sustainable Energy Access Program IESR, stated that having electricity or having access to electricity is an essential service for the community for welfare. For this reason, the definition of the electrification ratio needs to be updated, so there is no definition beyond connection. This means having electricity means receiving enough electricity for daily activities, productive activities, and other essential services for the welfare of society.

“Currently, there is Presidential Decree No. 11 of 2023, which gives more authority to local governments, especially the development of renewable energy. Then the next implementation is the program design or what kind of plan is suitable for providing renewable energy to the local area in seeking access to electricity. With decentralization, all energy source options from PLN, the central government, and local governments can be explored to improve quality so that it is hoped that access will be easy, reliable, and of good quality,” said Marlistya.

According to Lambas Richard Pasaribu, the VP of Development at Lisdes and Isolated Systems PLN, the national electrification ratio in Indonesia has reached 99.72% as of June 2023. However, there are still challenges in providing equal access to electricity, primarily due to limited infrastructure, such as roads and bridges. This is especially true in isolated and remote areas, particularly in eastern Indonesia. In some cases, no jetties are available, meaning that materials have to be dumped overboard and transported to the location by electrical contractor workers.

“To provide more rural areas with access to electricity, PLN collaborates with the Ministry of Energy and Mineral Resources (ESDM) and local governments, particularly in Disadvantaged, Frontier, and Outermost (3T) regions, to create regional infrastructure and work plans for electricity development. This teamwork is considered effective since establishing basic infrastructure can decrease the cost of constructing electricity infrastructure, allowing more villages to be connected to electricity,” said Lambas.

Sandra Winarsa, Manager of the Hivos Green Energy (Sumba) Project said ensuring fair access to electricity in all regions during the energy transition process and the Just Energy Transition Partnership (JETP) agreement is crucial. Moreover, people’s concern extends to the quality of electricity supply, as it frequently gets disrupted even for those with access to it.

“We appreciate the government’s program in fulfilling electrification, but the priority of terminating coal-fired power plants may overshadow the need to ensure equitable access to electrification for all. For this reason, don’t let anyone who has not received this electrification injustice fall into the abyss again. However, I don’t see any priority from JETP regarding access to electricity. In carrying out decentralization, regional government readiness is also needed to monitor in helping more prepared institutions and HR readiness to troubleshoot technical matters,” said Sandra.

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