Michael Richardson, For The Straits Times 14 Dec 09;
CONSIDER these two recent government announcements in Indonesia, South-east Asia's biggest economy.
A discussion paper released by the country's Finance Ministry and circulated last week at the climate change conference in Copenhagen proposes one of the most extensive plans in the developing world for cutting man-made greenhouse gas emissions that contribute to global warming.
It sets out strategies for reducing deforestation. By some measures, Indonesia is - or has been in recent years - the third largest emitter, after China and the United States, as its forests and peat swamps are cleared for agriculture, releasing huge amounts of carbon dioxide, the main greenhouse gas, into the atmosphere.
The Finance Ministry's Green Paper outlines measures to constrain future demand for coal and other fossil fuels in Indonesia, while promoting energy efficiency and increased reliance on abundant local sources of renewable geothermal power for generating electricity.
It says the government should prepare to impose a carbon tax on fossil fuels and phase out costly subsidies on these fuels to hasten the transition to a cleaner economy. The carbon tax revenue and savings on energy subsidies would help pay for the transition and offset the costs for the poor.
Meanwhile, as Indonesians were starting to digest the implications of these proposals, the state-owned electricity company Perusahaan Listrik Negara (PLN) was trying to reassure industrial and home consumers fed up with frequent blackouts that several new coal-fired power plants due to start operating in the first half of next year will ease the crisis.
The plants, which will add 1,890 megawatts to PLN's total capacity of around 24,000 MW, are part of a major expansion programme. The first phase is due to be completed in 2013. Much of the programme is based on switching from more expensive oil and diesel to locally-produced coal for generating electricity. As a result, PLN's coal consumption will almost double over the next two years, to around 41 million tonnes in 2011.
This energy and environmental snapshot in Indonesia encapsulates the dilemma facing many Asian countries as they try to balance their development objectives against increasing pressures to join a global battle against climate change.
President Susilo Bambang Yudhoyono has announced a target for Indonesia to cut emissions by 26 per cent by 2020 - through 'an energy mix policy including land use, land use change and forestry'. He also said a cut of up to 41 per cent was possible with international support, including funding and technology transfer.
He told the G-20 leaders' summit in Pittsburgh in September: 'We must tell the world it is possible to cure the global economy and save the planet at the same time.'
But in the meantime, the fact is that Indonesia and most other South-east Asian economies are heading towards a dirtier future, not a cleaner one.
In a recent overview of energy trends in the region, the International Energy Agency forecast that if Asean countries continue their business-as-usual approach, the region's primary energy demand will surge in the next 20 years at an average growth rate of 2.5 per cent per annum - much faster than the rest of the world.
By 2030, fossil fuels would be meeting 76 per cent of the region's energy demand, slightly more than today, with coal's share rising to 24 per cent, from 15 per cent now.
Coal produces much more carbon dioxide per unit of energy burned than oil or natural gas. So the projected rise in South-east Asia's demand for coal has significant implications both for global warming emissions and for local air pollution, from oxides of sulphur and nitrogen and fine soot particles that harm human health.
The region's energy-related carbon dioxide emissions will almost double by 2030, to nearly 2 billion tonnes a year. This would take South-east Asia's share of these emissions on a worldwide basis to 5 per cent, from around 3.5 per cent at present.
This would be in addition to the region's disproportionately large share of global emissions from deforestation and land use change. Power generation would account for more than half the increase in South-east Asia's energy-related carbon dioxide emissions.
However, there would be some major benefits. The number of people without access to electricity would fall from 160 million now to 63 million in 2030. This would constitute a huge leap forward in living standards, especially for the poor.
Indonesia's Green Paper points the way to a cleaner future for the region. But greater efficiency and lower-carbon sources of energy might not be able to meet demands for widely available and affordable electricity, as well as continued rapid economic growth.
These are very difficult choices for South-east Asian policymakers. Jakarta deserves credit for putting them in the public domain for discussion and debate.
The writer is a visiting senior research fellow at the Institute of Southeast Asian Studies.
