Energy security as positive force for green growth in Indonesia?

In this report the authors assess the potential of and obstacles to energy security and green growth in Indonesia.

How can the country (the world’s 6th largest greenhouse gas emitter) address its energy security challenges while embarking on a green growth path? What are the trade-offs, the win-win options, and how are these shaped by the larger political-economic framework in which Indonesia currently finds itself in?

Indonesia is facing serious and imminent energy security challenges and if these are not addressed adequately and soon, they will hamper economic development in the coming decades. Almost 20 years after the first democratisation and decentralisation programmes started, loose coalitions, policy inconsistency, weak service delivery and accountability of local governments and intermingled private and public interests affect government capacity to operate effectively and efficiently. Whilst energy security deteriorates, current energy investments are following a ‘business as usual’ fossil fuel-based path. Win-win opportunities are thus far underutilised in the country. As this report outlines, this unsustainable pathway is not inevitable and there is an opportunity for green growth solutions to be environmentally sustainable and improve energy security. Overall, in order to harness the positive benefits of solutions for green growth and energy security, long-term credible policy coordination will be necessary to mobilise large investments and foster private sector and grassroots mobilisation.

This report is part of a series of country studies on energy security and green growth in middle-income countries by means of Political Economy Analysis (PEA).