Reasons for Indonesia to adopt clean energy projects

Indonesia can't afford to stop paddling to new shores.

It's not all smooth going when it comes to the international renewable energy transition, but commitment is a must. Indonesia is one example of an important country in transition where we're looking at all the positive and negative signals to find investment angles.

Made up of over 17,000 islands in the Indian Ocean, this archipelago nation owes its modern existence to integration and access.

But local observers are worried that Indonesia's progress toward its own presidential renewable energy goals is moving too slow.

Only 64% of Indonesian households have access to electricity, and with Asia-Pacific nations all around it ramping up RE development, Indonesia's economy could end up between islands without an oar.

Indonesia has been Southeast Asia's leading oil producer, but like many of its petroleum peers, production is in steady decline.

The U.S. Department of Energy's international supply statistics show Indonesia with only 1 million barrels per day of output in 2008, compared to 1.6 million bpd in 1992.

Indonesia's oil consumption, though, rocketed from about 700,000 bpd to 1.16 million bpd over the same sixteen years!

That put it in the awkward position of being an OPEC member that actually dipped into net importer status in 2008. Indonesia withdrew its membership that same year, but it likely would have been forced out if it hadn't.

Indonesia has no time to lick its wounds after having to exit the world's most exclusive price club. Estimated average GDP growth of about 4.6% over the next five years means there's no rest for the weary when it comes to finding new energy resources.

35% of the Population Now "Excluded from Development"

President Susilo Bambang Yudhoyono must address the fact that 36% of Indonesians have no electricity, according to economist Terry Lacey in the August 24th edition of the online Asia Sentinel.

Not only is it a question of access to electricity. . . On the heels of two July bombings in the capital city Jakarta, Lacey points out an uncomfortable energy link for this rapidly developing country with the world's largest Muslim population (over 237 million):

"Without electricity, a third of Indonesians are excluded from development, which is a precondition for defeating terrorism."

In the Jakarta Post on August 12, National Development and Planning Agency Director Monty Girianna proffered the government's latest plan while copping to an amazing fact:

Though 91% of Indonesia's 70,000 villages have access to either grid-connected or stand-alone electricity resources, only two-thirds of residences can tap local supplies.