Energy Support Measures in Indonesia by Energy Source

The report inventories 78 support measures for Indonesia's energy sector between FY 2016 and FY 2020, covering oil and gas, coal, electricity, renewable energy, biofuels, and electric vehicles (EVs). It details various mechanisms including direct fund transfers, tax exemptions, and price supports, noting that only 37% of these measures were quantified due to data limitations.

• The inventory identified 78 support measures for the Indonesian energy sector between FY 2016 and FY 2020, though only 37% of these were quantified due to data limitations.
• The Indonesian government provides direct financial compensation to state-owned Pertamina to offset losses from selling motor gasoline, diesel fuel, and kerosene below market prices; this support reached USD 4,721 million in FY 2020.
• Oil and gas producers are required to supply up to 25% of their output to domestic refineries at a discounted price through the Domestic Market Obligation (DMO) system, which has been in place since 1979.
• Coal producers benefit from a preferential export tax rate of 1.5%, compared to a 7.5% rate for other mineral commodities, with the value of this support estimated at USD 1,137 million in FY 2020.
• The government provides compensation to PT PLN for electricity tariffs set below the cost of generation and distribution, with support amounting to USD 4,534 million in FY 2020.
• Renewable energy developers can access various tax incentives, including a 30% reduction in income tax for six years for projects in high-priority business areas such as hydropower, solar, wind, and geothermal.
• Biodiesel producers receive price support to bridge the gap between the market price of diesel fuel and biodiesel, funded by the Crude Palm Oil Supporting Fund (CSF) via export levies; this support reached USD 1,927 million in FY 2020.
• To accelerate the adoption of battery-powered electric vehicles, the government provides a zero luxury tax and has proposed a concessional GST, while the Bank of Indonesia allows for 0% down payments on EV purchases.
• The government supports the geothermal sector through the Infrastructure Fund for Geothermal Sector (PISP), which provided USD 4.1 million in FY 2020, primarily for PT Geo Dipa Energi.

APA

International Institute for Sustainable Development (2022). Energy Support Measures in Indonesia by Energy Source. https://www.iisd.org/system/files/2022-06/indonesia-energy-support-measures-annex.pdf

Chicago

International Institute for Sustainable Development. Energy Support Measures in Indonesia by Energy Source. 2022. https://www.iisd.org/system/files/2022-06/indonesia-energy-support-measures-annex.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=Energy Support Measures in Indonesia by Energy Source |date=2022 |url=https://www.iisd.org/system/files/2022-06/indonesia-energy-support-measures-annex.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2022energy, author = {{International Institute for Sustainable Development}}, title = {{Energy Support Measures in Indonesia by Energy Source}}, institution = {International Institute for Sustainable Development}, year = {2022}, url = {https://www.iisd.org/system/files/2022-06/indonesia-energy-support-measures-annex.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }