Fossil Fuel Subsidies in Indonesia: Trends, Impacts, and Reforms

Asian Development Bank (adb), Asian Development Bank (adb) (), Asian Development Bank (adb) and Asian Development Bank (adb)
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Asian Development Bank (adb): Economic Research and Regional Cooperation Department, ADB
Asian Development Bank (adb): Economic Research and Regional Cooperation Department, ADB

No RPT157694-2, ADB Reports from Asian Development Bank (ADB)

Abstract: Subsidized energy is provided to all Indonesian citizens as a public service obligation. This study measures the size of fossil fuel subsidies such as underpricing of petroleum products and electricity, tax exemptions, and subsidized credit; examines the potential economic, energy, and environmental impacts of reducing them; and discusses options for social safety nets to mitigate the impacts of the reforms. It shows that the short-term adverse impacts of subsidy reform turn positive in the long term as households and industry respond to changing market realities by adjusting energy demand, supply, and production capacity. Policy options for sustainable energy use are provided to aid policymakers in their current subsidy reform process.

Keywords: indonesia; fossil fuel; energy; fossil fuel subsidies; greenhouse gas emissions; energy use; economic impacts; social programs; developing asia (search for similar items in EconPapers)
Pages: 51 pages
Date: 2015-10
New Economics Papers: this item is included in nep-ene, nep-env and nep-sea
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Citations: View citations in EconPapers (11)

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