President Joko Widodo in his speech at the Plenary Session of the People’s Consultative Assembly, appreciated the rapid response of the Regional Representative Council (DPD) in addressing the pressing challenges faced by the region, one of which was related to renewable energy. This quick response has indeed been carried out by the DPD by initiating a New Renewable Energy Bill (EBT Bill), which is currently being discussed at Commission 7 of the House of Representatives. Grita Anindarini, Researcher of Environmental Pollution Control Division of Indonesian Center for Environmental Law, considers President Joko Widodo’s response to be positive given the need for energy transition in Indonesia is something that needs to be focused and needs to be responded quickly. Even so, it needs an in-depth study whether the existence of this bill can answer these needs.
In the academic text of the EBT Bill, it is explained that Law No. 30 of 2007 (the Energy Law) is currently not sufficiently accommodating about renewable energy, because the regulation of EBT is still scattered in various laws and regulations. Grita considers that one of the problems that caused this condition to occur is because the Government has not yet issued the Government Regulation (PP) on New and Renewable Energy, as mandated in the Energy Law. Basically, the formation of this PP has been included in the Strategic Plan of the Directorate General of New and Renewable Energy and Energy Conservation 2015-2019, but until now the regulation has not yet been issued. Based on the Strategic Plan, the New and Renewable Energy PP can be used as a more detailed reference related to the management of new and renewable energy including resource management, supply and utilisation, business, rights and obligations, facilities and incentives, energy prices, research and development, to guidance and supervision.
“Due to the absence of this Government Regulation, all this time related to the supply and use of renewable energy in general, incentives to prices are set at the level of Ministerial Regulations which often changes rapidly, causing legal uncertainty,” Grita said in her press release. Jakarta (20/08).
Aside from the scattered arrangements, Raynaldo Sembiring, Deputy Director of the Indonesian Center for Environmental Law, also highlighted the lack of clarity in the purpose of drafting the Law in the academic draft of the EBT Bill. Some of the problems outlined in the academic paper and used as reasons for the drafting of the EBT Bill are implemental issues that are basically regulated in existing laws, namely the Energy Law and the Electricity Law. Renewable energy management problems that are considered to be still not optimal include oversight of project running and project evaluation that is not in accordance with planning, data inventory related to regional potentials, not yet optimal regulations that exist to create a climate of renewable energy investment conducive for investors, including related to prices and incentives, to the extent of overlapping roles of the Government and Regional Governments in managing this EBT.
“Basically, there needs to be an in-depth study of whether all the answers to this problem are the issuance of new laws, or the need for implementing regulations from existing laws, or even simply by revising existing laws. Sadly, the study about this is excluded in the academic texts.”, complained Raynaldo.
Finally, regulatory reforms to support the development of new and renewable energy in Indonesia are indeed needed to encourage the energy transition. Setting regulations on target is an important key to answering this. For this reason, an in-depth study needs to be carried out so that the EBT Bill can become an effective regulation in addressing existing problems.
Raynaldo Sembiring – Deputy Director of ICEL (081376670167)
Grita Anindarini – Researcher of Pollution Control Division of ICEL (082122470088)