214 Mariana Silaen et al.
a budget constraint being subsequently imposed) will create obstacles for the
overarching development. The lack of investment is likely to create a domino
effect on supporting measures such as installation, maintenance, training, and
incentives. The risk is identified in both pathways and heavily depends on the
national policy on renewable energy. Initial investment is also shaped by
enabling policies and regulations concerning the private sector. For example,
the latest electricity law (UU no. 30/2009) and its implementing regulation (PP
No. 14/2012) allowed the private sectors to be actively involved in the power
sector, such as by running a power generation business (Kuvarakul et al., 2014).
Suitable laws and regulations would mitigate this risk by attracting more privatesector investment in either pathway, thereby financially supporting the lowcarbon economy, as suggested previously (Masini and Menichetti, 2012).
Other important risks are related to how the comparative advantages of the
main alternative energy options stack up. In this respect, one of the main challenges is the cheaper fossil- fuel energy. For example, a three- kilogram LPG tank
for households is subsidised, as regulated in ESDM’s ministerial decree no. 2458
K/12/MEM/2017. The effect of such subsidy should not be underestimated as,
for many rural residents that use LPG, there is a risk of preferring LPG to biogas
in this pathway. The main causes are cheaper conventional energy with lower
initial investment at the household level, as well as fewer technological barriers.
When it comes electricity generation, PLN also faces challenges in purchasing
the renewables in general since they are more costly than coal, which is subsidised by the government (International Institute for Sustainable Development,
2018). This subsidy itself is one of the rooted reasonings behind the more affordable current electricity tariff.
Other risks relevant to both pathways concern the choice of technology,
which is not always appropriate. For instance, it was noted that in some cases
household biogas installations had developed cracks or leaks in the tanks due to
unsuitable local biophysical conditions (Devisscher et al., 2017). Taking into
account the local conditions is a necessity according to the policymakers who
emphasised that not all Indonesian regions are suitable for biogas. Bappenas
gave the example of Nusa Tenggara Timur (NTT) province – a semi- arid area
where biogas development would be difficult, since continuous water supply is
essential to operate the technology. On the other hand, the island of Sumatra,
one of the world’s largest palm- oil producers, would make a promising biogas
generator (Rahayu et al., 2015). The abundance of palm- oil mill effluent
(POME) waste and the local conditions may favour choosing technologies for
electricity generation from biogas.
We found that risks of possible leakage of methane emissions and unfiltered
H 2 S would occur on both pathways, as they are based on similar technological
principles. Both risks were observed in the household biogas digesters
(Devisscher et al., 2017) and large- scale ones, such as the POME installations
(Promnuan and O- Thong, 2017).
a budget constraint being subsequently imposed) will create obstacles for the
overarching development. The lack of investment is likely to create a domino
effect on supporting measures such as installation, maintenance, training, and
incentives. The risk is identified in both pathways and heavily depends on the
national policy on renewable energy. Initial investment is also shaped by
enabling policies and regulations concerning the private sector. For example,
the latest electricity law (UU no. 30/2009) and its implementing regulation (PP
No. 14/2012) allowed the private sectors to be actively involved in the power
sector, such as by running a power generation business (Kuvarakul et al., 2014).
Suitable laws and regulations would mitigate this risk by attracting more privatesector investment in either pathway, thereby financially supporting the lowcarbon economy, as suggested previously (Masini and Menichetti, 2012).
Other important risks are related to how the comparative advantages of the
main alternative energy options stack up. In this respect, one of the main challenges is the cheaper fossil- fuel energy. For example, a three- kilogram LPG tank
for households is subsidised, as regulated in ESDM’s ministerial decree no. 2458
K/12/MEM/2017. The effect of such subsidy should not be underestimated as,
for many rural residents that use LPG, there is a risk of preferring LPG to biogas
in this pathway. The main causes are cheaper conventional energy with lower
initial investment at the household level, as well as fewer technological barriers.
When it comes electricity generation, PLN also faces challenges in purchasing
the renewables in general since they are more costly than coal, which is subsidised by the government (International Institute for Sustainable Development,
2018). This subsidy itself is one of the rooted reasonings behind the more affordable current electricity tariff.
Other risks relevant to both pathways concern the choice of technology,
which is not always appropriate. For instance, it was noted that in some cases
household biogas installations had developed cracks or leaks in the tanks due to
unsuitable local biophysical conditions (Devisscher et al., 2017). Taking into
account the local conditions is a necessity according to the policymakers who
emphasised that not all Indonesian regions are suitable for biogas. Bappenas
gave the example of Nusa Tenggara Timur (NTT) province – a semi- arid area
where biogas development would be difficult, since continuous water supply is
essential to operate the technology. On the other hand, the island of Sumatra,
one of the world’s largest palm- oil producers, would make a promising biogas
generator (Rahayu et al., 2015). The abundance of palm- oil mill effluent
(POME) waste and the local conditions may favour choosing technologies for
electricity generation from biogas.
We found that risks of possible leakage of methane emissions and unfiltered
H 2 S would occur on both pathways, as they are based on similar technological
principles. Both risks were observed in the household biogas digesters
(Devisscher et al., 2017) and large- scale ones, such as the POME installations
(Promnuan and O- Thong, 2017).