Gradual Energy Transition Expected to Save Rp90tn of Fuel Subsidy per Year: Minister Luhut
Translator
Editor
4 September 2024 20:25 WIB
TEMPO.CO, Jakarta - The Coordinating Minister for Maritime and Investment Affairs, Luhut Binsar Pandjaitan, said a gradual energy transition will save Rp45 trillion to Rp90 trillion of fuel subsidy per year.
Minister Luhut conveyed the statement during the sidelines of the High-Level Forum on Multi-Stakeholder Partnerships (HLF MSP) and Indonesia-Africa Forum (IAF) II in Badung, Bali, on Monday, September 2, 2024.
The gradual energy transition consists of shutting down the Suralaya coal-fired steam power station (PLTU) in Cilegon, Banten, applying carbon emissions standards for industries, and pushing the use of electric vehicles (EVs).
Minister Luhut claimed EV usage will cut the cost that has been allocated for subsidized fuel thus far. “(Rp45 to 90 trillion) is a significant number and we could utilize them for more matters of interest going forward,” Luhut said, as quoted from Antara.
According to Luhut, due to air pollution, the government thus far spent Rp38 trillion on medical expenses for Indonesian people. With the energy transition, however, Luhut said the government will be able to tackle pollution issues in the country, especially in Jakarta.
“We also learn from China, they are successful in handling the air pollution issue,” Luhut said.
The Finance Minister, Sri Mulyani Indrawati, previously stated that the government allotted Rp421.7 trillion for energy resilience in the 2025 State Budget Bill.
The government will utilize the budget to boost energy subsidies and compensation. Meanwhile, in the 2025 State Budget Bill, the government is preparing a Rp394.3 trillion budget ceiling for energy subsidy and compensation. This figure rises 17.8 percent compared to the 2024 budget ceiling of Rp338.4 trillion.
Meanwhile, the energy subsidy and compensation budget is distributed for subsidized 3-kg LPG cylinders, diesel fuel, and kerosene as well as ensuring the program hits the mark. Sri Mulyani said energy transition will support the electricity for poor and vulnerable households and ensure an efficient and just energy transition.
ANTARA
Editor’s Choice: Energy Minister Bahlill Confirms Plan to Limit Subsidized Fuel Purchases
Click here to get the latest news updates from Tempo on Google News
