Biodiesel Saves the State Rp4.9 Billion
4 December 2013 20:00 WIB
TEMPO.CO, Jakarta - Director General of New and Renewable Energy for the Ministry of Energy and Mineral Resources, Rida Mulyana, aims for savings in oil subsidies in 2014 to reach Rp4.9 trillion (around US$409.5 million).
The target can be achieved through the usage of biodiesel in subsidized diesel fuel. “This strategy can reduce imports of diesel fuel, while simultaneously utilizing domestically produced palm oil,” he said during the national seminar on energy conservation yesterday.
Since last September, the government has imposed Ministerial Decree ESDM Number 25/2013, which requires the usage of biodiesel fatty acid methyl ester (FAME) of at least 10 percent of subsidized diesel fuel. The fuel mixture will be used in transportation, industrial, commercial and power plant sectors. With the regulation, usage of biodiesel in oil, previously targeted to be 1.1 million kiloliters, will increase to 1.2 million kiloliters this year.
Rida said subsidy savings, as the result of mixing biodiesel with subsidized diesel, have been felt since last September. In December, the savings can reach Rp276.8 billion. Up until now, 16.5 million kiloliters of subsidized diesel fuel have been mixed with biodiesel.
Usage of biodiesel will also increase state subsidy savings that have already been realised through decreased consumption of subsidized fuel. According to Rida, consumption of Premium until November was still 5 percent below the quota set in the State Budget (APBN)—because a lot of Premium users have switched to Pertamax. “But this doesn’t apply to subsidized diesel fuel,” he said.
Nevertheless, Rida said Indonesians still waste energy because 96 percent of consumed energy is in the form of fossil fuel. According to him, Indonesia’s dependency on fossil energy imports is very high. The government’s data show that demand for oil fuel in Indonesia reached 1.5 million barrels per day. By contrast, domestic production is only 870 thousand barrels per day. As a result, Indonesia has to import oil and is burdened by Rp272 trillion in subsidies in 2013.
After a coordination meeting in his office last week, Coordinating Economic Minister Hatta Rajasa stated that usage of FAME in September through December would reach 379,613 kiloliters. As a result, there will be US$298 million (Rp3.29 trillion) savings in foreign exchange. On the other hand, savings from non-subsidized fuel usage in 2013 reached US$158 million (Rp1.74 trillion). “The target will be achieved if there’s no interference in supply,” he said.
Hatta said the government has set key performance indicators (KPI) on biodiesel usage for transportation, industrial, commercial, as well as power plant sectors in 2013. The KPI for subsidized transportation sector (public service obligation/PSO) is pegged at 10 percent, and for non-PSO transportation at 3 percent. The government also pegs the KPI at 5 percent for industrial and commercial sectors. For the power plant sector in particular, biodiesel usage is pegged at 7.5 percent.
The KPI will be increased in 2014. According to Hatta, biodiesel absorption for PSO and non-PSO transportation reached 10 percent. The same number is applied to industrial and commercial sectors. While for the power plant sector, the government set a KPI of 10-20 percent in 2014. “Therefore, the 10 percent target of biodiesel usage in diesel fuel will be achieved next year.”
MARIA YUNIAR | FERY FIRMANSYAH
