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Our population and hunger for limited energy

Publication Date : 25-04-2012

 

Energy is consumed mostly by humans and for the purpose to fuel human activities. It is clear that, for an economy, there is a correlation between the size of a population and the amount of energy demanded.

The structure and composition of population bring different influences to the amount of energy consumed.

Some general trends might apply. Energy demand is higher for people in productive ages than for the very young and senior citizens. Energy demand is larger for people with higher levels of education than those with lower ones.

Energy demand is larger for those with strong incomes. People with higher incomes have larger mobility and flexibility, enabling them to do more activities and consume larger amounts of energy than those with lower incomes.

And people residing in urban areas, with their urban facilities and lifestyle, tend to consume larger amounts of energy than those living in rural areas.

According to the International Energy Agency’s Key World Energy Statistics 2011, Indonesia’s primary energy demand is about 202 million tons of oil equivalent (TOE).

This figure is far lower compared to that of other populous and industrial countries like China, India, the US, Japan and Russia, and is only comparable to only that of less populous nations like South Korea, Iran and the United Kingdom.

Indonesia’s per capita energy consumption is merely about 0.9 TOE, lower than the world’s average of 1.8 TOE and far lower than the OECD average of 4.3.

Other statistics suggest strong correlations between energy demand and GDP, and between energy demand and the country’s “level of prosperity” (suggested, for example by HDI — human-development index figures). Reducing the complexity, one might conclude that for an economy “to enter a high-level income” or to have a “prosperous” status, the availability of certain amounts of energy consumption per capita is required. Energy is also the key factor to increasing overall productivity.

Our country is currently far from having both high incomes and a prosperous status, meaning that large amounts of energy will be required to bring us to achieve a better economy and prosperity

Indonesia is the world’s fourth-most populous country. Our current population is around 240 million, growing 1.49 per cent a year — higher than the global growth rate of 1.1 per cent.

This means that around four million new babies will be born this year and many more will come in the future years.

The interesting question is: How much energy (electricity and fuel) is needed to allow all those babies to grow up and lead healthy lives?

Indonesia is a “young” country. Most Indonesians are of productive ages: They will still be in labour force in the next two to three decades. Education levels, even if they are still low, are getting better, with the average length of schooling currently 5.8 years, an increase from 4.8 years in 2000.

With our current GDP standing at around US$834.3 billion — 17th in the world — our GDP per capita is about $3,469. Our HDI value is also getting better, from 0.543 in 2000 to 0.617 in 2011. These figures are expected to improve.

Long known as a huge rural country, the recent year saw the number Indonesians living in urban areas surpassing those staying in villages. Cities are clustered in Java, with the island currently having a population density of more than 1,000 people per square kilometre — the most crowded in the world.

With the population dominated by young-productive age citizens, increased income per capita, longer schooling years and a larger population in urban areas, they are still consuming only a low amount of energy.

All these factors suggest that Indonesia’s energy demand will increase significantly in the near future. Projections by National Energy Council, for example, suggest that our energy consumption will double from 2010 to 2030.

Meeting the coming energy demand is surely one of our tougher challenges.

Presently, we own only limited energy infrastructure centred in Java and are able to supply energy only to small parts scattered across the archipelago.

As energy becomes scarcer and more expensive in the near future, providing additional amounts of energy would require much larger efforts than in the past.

Indonesia’s electricity consumption (140.1 terawatt-hours/TWh) is quite low compared to many other countries. Per capita, our electricity consumption is 609 kilowatt-hours (KWh), lower than the world’s average (2,230 KWh) and is also far lower than that of Singapore, Malaysia and Thailand.

Households with access to electricity is still below 70 per cent; and mostly centred in urban areas.

It is important to note that the share of electricity in total energy consumption suggests the age of the country’s energy supply sys-tem. With the current share of electricity of only 7 per cent in our total primary energy supply, Indonesians have to work far harder to provide electricity than for other energy supplies.

One of the basic problems with Indonesia’s population is its distribution. Java, amounting to 7 per cent of the country’s total area, is home for 57 per cent of Indonesians. Java consumes about three-quarters of the country’s energy and 80 per cent of electricity.

Of the bulk of primary energy it consumes, Java has a very little of its own resources. Almost all of the oil, gas and coal the island is consuming are imported, making Java one of the largest energy-importing islands in the world.

The island is the place where most of the government’s energy subsidies has gone.

Providing energy to Indonesians, due to the increase in the population and our hunger for energy, is a task that has to be fulfilled.

However, continuing the tendency of supplying more and more energy to Java is something we have to start avoiding, since the efforts will be more costly, riskier and increase the feeling of injustice to people living in other islands.

Java’s capacity is already ex-ceeded, making it no longer a healthy place for population to grow or to provide more complex energy delivery system.

Rather, it is better to move the population of Java (and thus energy demand) to Indonesia’s other islands, which are numbered in their thousands.

The writer is energy policy analyst with BAPPENAS.

 

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