Controlling Policies on Fossil Fuels Subsidies to Overcome Climate Change

Biatna Dulbert Tampubolon () and Ajun Tri Setyoko ()

Energy Economics Letters, 2019, vol. 6, issue 1, 1-16

Abstract: The Indonesian government faces the challenge to provide energy at affordable prices and able to meet national energy needs. Government policies provide energy subsidies to reduce consumer expenses and ease production costs borne by energy producers. However, this adds to the burden of the state and also increases greenhouse gas emissions. Sometimes subsidies are often used as a powerful political program to gain support from the community. This study attempts to review the various literature on energy and environmental policies discussed which will be identified as ‘opportunities’ that may be adopted by Indonesia, especially from G20 members and others. The policy of controlling energy subsidies should continue to be enhanced and comprehensive, for example, limiting the use of subsidized fuel with direct and closed distribution (learning from India), adjusting subsidized retail prices, and in line with affordable public transport. The use of the degraded land would be more productive to absorb carbon from the atmosphere and generate biofuel energy than the transfer of forest. The government necessary provides substantial subsidies for the development of new energy sources (learning from Russia and the United States) and renewable energy programs, including the construction of pipelines for gas and other energy. The government invites the private and public sectors to engage in the development of renewable energy such as Europe.

Keywords: Subsidies; Policy; Energy; Environment; Emission. (search for similar items in EconPapers)
Date: 2019
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