Potentials and challenges in implementing feed-in tariff policy in Indonesia and the Philippines

Bakhtyar, B.; Sopian, Kamaruzzaman; Zaharim, Azami; Salleh, Elias; Haw, Lim Chin

doi:10.1016/j.enpol.2013.05.034

Cited by 43 publications

(27 citation statements)

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“…As noted above, subsidies in Indonesia historically decreased the attractiveness of geothermal exploitation by suppressing the price of fossil fuels. Fuel prices in the Philippines have been almost twice as high as those in Indonesia in recent years (Bakhtyar et al 2013). These higher prices provide a stronger incentive to the energy industry in the Philippines to generate electricity from non-carbon-based sources.…”

Section: The Philippinesmentioning

confidence: 99%

Governance Obstacles to Geothermal Energy Development in Indonesia

Winters

Cawvey

2015

Journal of Current Southeast Asian Affairs

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Despite having 40 per cent of the world's potential for geothermal power production, Indonesia exploits less than five per cent of its own geothermal resources. We explore the reasons behind this lagging development of geothermal power and highlight four obstacles: (1) delays caused by the suboptimal decentralisation of permitting procedures to local governments that have few incentives to support geothermal exploitation; (2) rent-seeking behaviour originating in the point-source nature of geothermal resources; (3) the opacity of central government decision making; and (4) a historically deleterious national fuel subsidy policy that disincentivised geothermal investment. We situate our arguments against the existing literature and three shadow case studies from other Pacific countries that have substantial geothermal resources. We conclude by arguing for a more centralised geothermal governance structure.

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Section: The Philippinesmentioning

confidence: 99%

Governance Obstacles to Geothermal Energy Development in Indonesia

Winters

Cawvey

2015

Journal of Current Southeast Asian Affairs

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“…As of 2012, the Philippine generation capacity relies on coal (30%), hydro (22%), oil (18%), natural gas (18%) and geothermal (11%), solar and biomass representing less than 0.7% altogether (DoE, 2013). While it has been shown that the Philippines have a lot of potential when it comes to the development of solar and wind energy, the current regulatory framework has failed, so far, to attract significant private investment on renewable energies (Bakhtyar et al, 2013).…”

Section: Implementation and Assessment Of The Epiramentioning

confidence: 99%

The Philippine electricity sector reform and the urban question: How metro Manila's utility is tackling urban poverty

Mouton

2015

Energy Policy

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HAL is a multi-disciplinary open access archive for the deposit and dissemination of scientific research documents, whether they are published or not. The documents may come from teaching and research institutions in France or abroad, or from public or private research centers. L'archive ouverte pluridisciplinaire HAL, est destinée au dépôt et à la diffusion de documents scientifiques de niveau recherche, publiés ou non, émanant des établissements d'enseignement et de recherche français ou étrangers, des laboratoires publics ou privés. The Philippine electricity sector reform and the urban question Morgan MoutonTo cite this version:Morgan Mouton. The Philippine electricity sector reform and the urban question: How metro Manila's utility is tackling urban poverty. Energy Policy, Elsevier, 2015, Urban energy governance: local actions, capacities and politics, 78, pp.The electricity reform did not take the urban poor into consideration. The state retreated from issues of electrification. Decentralisation favoured the emergence of new, local actors for this aspect of energy policy. The distribution utility is left with an increased power over issues of access to electricity. Territorially and qualitatively, electrification programs are more diverse. a b s t r a c tIn the early 2000s, the Philippine government reformed its electricity sector following neoliberal principles: unbundling of the power industry, privatisation of assets and commodification of electricity. This paper shows that the reform was primarily driven by the need to secure electricity supply and cut down tariffs. These national objectives ousted other issues, and notably those that find their expression at the urban level, among which the question of access to electricity in Metro Manila's urban poor communities. The central state withdrew its attention from the issue of electrification, and local actors had to react as they were confronted to social tensions and practices of pilferage. As a consequence, city governments and local administrations are getting involved in this issue, which opens the way to participation of civil society. This paper shows how the "rolling back" of the central state led to new partnerships and arrangements between the distribution utility, local governments and community organisations. This movement points to an urbanisation of energy issues, which could bring positive results for end-users provided that it is accompanied by a clearer regulatory framework.1 The well-known World Bank (1993) paper The World Bank's role in the electric power sector: policies for effective institutional, regulatory, and financial reform received a lot of attention from Philippine policymakers. Beyond their mere influence, these two institutions had a more direct involvement in the reform with two loans that set precise requirements: a 1984 WB loan of USD 300 million required the adoption of laws on privatisation (that came to be Presidential Decrees 2029 and 2030), and a 1998 ADB loan (supported by the WB and the IMF) of another USD 300 mill...

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“…Some papers discuss the political economy with reference to the key RE stakeholders in Indonesia, while others address specific fiscal policies on specific energy sources. Bakhtyar et al (2013), Dutu (2016), Fathoni et al, (2014), Nasruddin et al (2016) and Winters and Cawvey (2015) focus on energy-pricing policies, especially for geothermal energy [3,4,[15][16][17].…”

Section: Introductionmentioning

confidence: 99%

“…Some research on fiscal policies focuses heavily on FiTs, but there is little analysis of the variation of cost structure of RE projects and how fiscal policies are tailored to that in each specific country. Bakhtyar et al (2013) [15] and Fathoni et al (2014) [16] do not discuss other fiscal incentives such as tax breaks and value added tax (VAT) reduction, but they highlights some challenges to implement FiT in Indonesia and the Philippines.…”

Section: Introductionmentioning

confidence: 99%

The Political Economy of Indonesia’s Renewable Energy Sector and Its Fiscal Policy Gap

Halimanjaya¹

2019

IJEFM

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This research paper identifies fiscal policy gaps that occur in Indonesia's renewable energy (RE) sector and analyses its political economy. Primary data from 37 stakeholders and secondary data from fiscal policies from Indonesia's 2007-2017 taken from Ministry of Finance (MOF) and Ministry of Energy and Mineral Resources (MEMR) regulation databases. The fiscal policy data were analysed using a cluster approach and meta-synthesis method. The results show that Indonesia has experienced multi-faceted principal-agent problems between PT PLN, the agent with sole authority to manage electricity transmissions, and various principals, namely the Ministry of State Owned Enterprises (MSOE), the MEMR, the Ministry of Industry (MOI) as the intermediary between domestic and foreign RE industries, and the MOF. While changing the MEMR's feed-in-tariff (FiT) policies sends an uncertain policy signal, the MOF's fiscal incentive policies other than FiT to promote RE development in Indonesia remain sub-optimal; the fiscal policies required to incentivise a large volume of smalland medium-scale investment in RE are absent. Differentiated tax rates and tax-break periods for national and foreign companies on the micro, small and medium scales could significantly accelerate the development of RE by both domestic and foreign companies, supporting Indonesia in achieving its sustainable development goals and emission reduction targets under its nationally determined contribution.

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Potentials and challenges in implementing feed-in tariff policy in Indonesia and the Philippines

Cited by 43 publications

References 1 publication

Governance Obstacles to Geothermal Energy Development in Indonesia

Governance Obstacles to Geothermal Energy Development in Indonesia

The Philippine electricity sector reform and the urban question: How metro Manila's utility is tackling urban poverty

The Political Economy of Indonesia’s Renewable Energy Sector and Its Fiscal Policy Gap

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