SYSTEM DYNAMICS MODELING OF OPTIMIZING GEOTHERMAL POTENTIAL IN INDONESIA TOWARDS EMISSION REDUCTION EFFORT: A CASE STUDY IN STATE-OWNED ENERGY ENTERPRISE

• Main Author: Yudho Aji, Dhamar
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/81301
• Institution: Institut Teknologi Bandung

The energy sector has an important task to provide fuel for people to operate their businesses and households. On the other hand, the energy sector is also one of the major contributors to Greenhouse Gas (GHG) emissions. The Government of Indonesia has set long-term strategy for transitioning to more low-carbon energy to enhance country’s economic resilience and sustainable development. To realize that strategy, energy sector in Indonesia should implementing energy transition plan by diversifying their portfolios to incorporate renewable energy into their operations to reduce environmental footprint. Indonesia has an abundance of geothermal resources; hence the development of geothermal energy may become one of those phases. Literature review and stakeholders’ interview are conducted to identify the key variables that may contribute to the optimizing geothermal potential in indonesia towards emission reduction effort. The rich picture diagram is composed to illustrate all the stakeholders and variables involved. Energy mix, carbon tax implementation, price of carbon credits, project completion time, external funding, and government incentives are among the identified key variables. These crucial elements are subsequently incorporated into a system dynamic model to assess the quantitative effects of alterations to those variables on the target achievement for geothermal capacity and the reduction of emissions both nationally and within the company. There are twenty-nine scenarios developed from nine group scenarios including two combinations of interventions. The simulation result shows that the development of geothermal energy potential in Indonesia can be sped up by strong stakeholder commitment to provide specific incentives and availability of financial sources. Furthermore, to lower emissions, stakeholders can work together to strengthen policy instrument like the implementation of carbon tax, establish higher portion for renewable energy mix, and support carbon-based industries (e.g. carbon trading mechanism) in addition to developing renewable energy. Moving forward, it is imperative for all stakeholders to collaborate effectively in leveraging financial mechanisms, and regulatory frameworks to unlock the full potential of geothermal energy in Indonesia.