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MESSAGE

from the Chairperson of Purnomo Yusgiantoro Center

Welcome to year 2018! The first quarter of the year 2018 has been an exciting and busy time for all of us. We conducted an international event and published several publications in the past few months. In February 2018, PYC collaborates with International Power Supply (IPS) A.D. and the Indonesian Embassy in Bulgaria to conduct a successful international seminar of “Renewable Innovation Forum: Sustainable Off-grid Electrification and Renewable Energy Opportunities in Indonesia” at Hotel Indonesia Kempinski, Jakarta. There were more than 150 representatives from different backgrounds participated in the seminar. In the same period, PYC also published two proceedings; the proceeding of Pertambangan dan Energi Expo 2017 (Mining and Energy Expo 2017) and the proceeding of PYC International Energy Conference (IEC) 2017. PYC has also published its very first academic journal, the Indonesian Journal of Energy, IJE Vol.1, No. 1 (2018). The journal is expected to make a significant contribution to the research and development of the energy sector in Indonesia.

As for the following months, PYC will run several interesting events: PYC Knowledge Sharing Series and PYC Energy Workshop. Both events will take the same theme focusing on discussions and assessments of the current situation in the energy sector in Indonesia under the perspective of energy economics. While PYC Knowledge Sharing Series will invite experts in the energy economics for an informal discussion on the current condition of energy in Indonesia, PYC Energy Workshop will provide a hands-on training session for participants to learn on basic modeling and statistical analysis of energy data by using STATA (a Data Analysis and Statistical Software). We welcome participants from any background to join both of the events.

We also would like to announce a Call for Paper for the Indonesian Journal of Energy, IJE Vol. 2, No.1 (2019), with a special issue for “Energy Law, Governance, and Policy.” The aim of this special edition is to have articles on legal and policy issues concerning both energy activities and energy resources at the local, national, and global level. This special edition also aims to add existing recommendations and literature about energy law and policy, and thus providing value to our readers.

We are very grateful for what we have achieved in our activities and contribution to the energy society since last year. We also are looking for any future collaborations and partnerships.

We wish you a great time and Happy Easter!

 

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PASTEvent

“RENEWABLE INNOVATION FORUM”

RENEWABLE INNOVATION FORUM: SUSTAINABLE OFF-GRID ELECTRIFICATION AND RENEWABLE ENERGY OPPORTUNITIES IN INDONESIA

“Renewable Innovation Forum: Sustainable Off-grid Electrification and Renewable Energy Opportunities in Indonesia” is a collaboration between Purnomo Yusgiantoro Center (PYC), International Power Supply (IPS) A.D., and Indonesian Embassy for Bulgaria in Sofia. The event was held at Hotel Indonesia Kempinski, Jakarta on Thursday, 22nd February 2018. The forum was aimed to gather people from different sector to have an extensive discussion not only on the ongoing problems but also what kind of solutions they can bring to Indonesia’s off-grid electrification sector. During this event, more than 150 representatives from different government institutions, business sector as well as academic sector came together and had a productive discussion by sharing their respective knowledge with each other.

The event was opened by Prof. Purnomo Yusgiantoro as the representative of PYC and H.E. Sri Astari Rasjid as the Indonesian Ambassador to Bulgaria. The keynote speech was delivered by Mr. Ignasius Jonan as the Minister of Energy and Mineral Resources of the Republic of Indonesia. The speech highlighted the current focus of energy sector development in Indonesia, “Energy Equity.” During his speech, Mr. Ignasius Jonan highlighted that the government managed to exceed the 2017’s electrification ratio goal with an innovative program, for example, the Energy Efficient Solar Lamp (LTSHE).  In the future, more innovative technology will be needed in order to fulfill Indonesia’s sustainable development program.

Presentation from Mr. Ignasius Jonan on Energy Equity

After the speech by Mr. Ignasius Jonan, three Memorandum of Understandings (MoU) were signed. The first MoU was between IPS and Unhan which promised joint research in off-grid area electrification using IPS' Exeron technology. On the other hand, the MoU with ITB focused on the technological development of the technology while the MoU with PT. Len focused on the industrial application and technological transfer.

The session afterward was the plenary session. Mr. Rida Mulyana represented the Directorate General of New Energy, Renewable Energy and Energy Conservation of the Ministry of Energy and Mineral Resources while Mr. Agoes Triboesono represented the Directorate General of Electricity of the Ministry of Energy and Mineral Resources. The plenary session was led by Mr. Herman Darnel Ibrahim as the Chairman of Indonesian National Energy Committee CIGRE.

After the lunch break, the first-panel session was started with Mrs. Evita Legowo as the chair of the session. The first-panel session covered the upstream sector of renewable energy which includes the electricity generation from renewable energy sources. The panels for this session were Mr. Harris from the Directorate General of New Energy, Renewable Energy and Energy Conservation, the Ministry of Energy and Mineral Resources, Mr. Gigih Prakoso as Director of Investment and Risk Management of Pertamina, Mr. Andre Susanto as the founder and senior VP of PT Inovasi Dinamika Pratama, and Mr. Damien Tournillon as the Smart Grid Engineer from Engie.

The second-panel session covered the downstream sector of renewable and was chaired by Mr. Jarman Sudimo as the Director General of Electricity (2011 – 2017). During this session, Mr. Tohari from PT PLN presented the Development of New and Renewable Energy in Indonesia’s Electricity Sector. Mr. Alihuddin Sitompul, as the Director of Electricity Development Program of Directorate General of Electricity, the Ministry of Energy and Mineral Resources had a presentation about Renewable Off-grid Electrification. From IPS partners, Mr. Aria Witoelar, as the founder of PT Arya Watala Capital, gave a presentation about Rural Electrification through Village Grids / Mini-grids and Mr. Fendi Gunawan Lim from PT Selaras Daya Utama had a presentation about Off-grid Renewable Energy.

A question and answer session was held after each panel. The audience had an exciting discussion with the panels, and a number of discussions even continued after the session ended. Hopefully, this productive discussion will bring a lot to Indonesia’s off-grid electrification and renewable energy sector.

The forum was closed with a networking session where the guest mingled to know each other better. The networking session was accompanied by some popular Indonesian music from a traditional instrument namely Kolintang. During this session, IPS also presented their Exeron product which can bring a solution to Indonesia’s electrification problems, especially in the remote area.

“PROCEEDINGS PUBLISHED BY PYC”

THE PROCEEDING OF "MINING AND ENERGY EXPO 2017"

AND

THE PROCEEDING OF "PYC INTERNATIONAL ENERGY CONFERENCE 2017"

We have published two proceedings in the beginning of 2018. The first proceeding, Pertambangan dan Energi Expo 2017 (Mining and Energy Expo 2017), is a collection of materials and discussions during the celebration of the Energy and Mineral Resources Ministry’s anniversary. The event was held on 26th and 27th of September 2017. This proceeding is published in Bahasa and consists summaries from speakers presentation and Q&A session for each parallel session. This proceeding is available in printed version through our center.

The second proceeding, PYC International Energy Conference (IEC) 2017, provides materials and summaries presented by speakers and paper presenters during the conference which was held on 29th of November 2017. The proceeding is published in English. It compiles selected research papers and works from the competition winners for photos, infographics, and essays. The proceeding is available both in online and printed version.

Mining and Energy Expo 2017 Proceeding

Printed version available

PYC International Energy Conference (IEC) 2017 Proceeding

Online and printed version available

“THE INDONESIAN JOURNAL OF ENERGY VOL. 1, No. 1 (2018) HAS BEEN PUBLISHED”

 

INDONESIAN JOURNAL OF ENERGY (IJE) VOL.1, NO. 1 (2018)

We are pleased to announce the publication of the first issue of the first volume of The Indonesian Journal of Energy (IJE) on February 28th, 2018. The journal aims to be an authoritative source of information for analysis, reviews, and evaluations related to the energy sector. The papers published in this volume went through a rigorous process of double-blind peer review. The papers published in this volume are:

  • Planning the Electrification of Rural Villages in East Nusa Tenggara Using Renewable Energy Generation

            Authors: Jannata Giwangkara, Bart van Campen

  • Enhancing Energy Security through Utilization of Local Resources

            Authors: Indradarma Adiwibowo, Dita Anggun Lestari, Davit Manalu

  • Study of Gas Resources Utilization of Tangguh, Masela, and Kasuri Blocks for East Indonesia Regional Development

           Authors: Tutuka Ariadji, Luky Yusgiantoro, D. Susanto, D. Sunarjanto, D. Sismartono, W.A.             Akbar, Wisnu P. Taher, A. Arsegianto

  • Investigation of the price linkage between Asian LNG spot and Far East Asian LNG prices and its implications

           Author: Muhammad Anas Pradipta

  • Designing Oil and Gas Exploration Strategy For The Future National Energy Sustainability Based on Statistical Analysis of Commercial Reserves and Production Cost in Indonesia

           Authors: Ahmad Abdul Azizurrofi, Dian Permatasari Mashari

We would like to thank all the authors, editors, reviewers and every party participated in the publication of this volume. The journal can be accessed through the button below.

“CALL FOR PAPERS”

CALL FOR PAPERS

INDONESIAN JOURNAL OF ENERGY VOL. 2, NO. 1 (2019):

A SPECIAL ISSUE OF "ENERGY LAW, GOVERNANCE & POLICY"

For the upcoming 1st issue of the 2nd volume of IJE which will be published on February 2019, we announce a CALL FOR PAPERS for the journal's SPECIAL ISSUE OF "ENERGY LAW, GOVERNANCE & POLICY". This special issue aims to collect articles on legal issues and policy implications concerning energy activities and energy resources at the local, national and international level. Hence, the special edition invites manuscript submissions with the following topics:

  • Competition law in energy security and sustainability;
  • Constitutional law in energy commercialization;
  • Investment law and policy in energy and mineral resources;
  • Corporate governance in the energy sector;
  • Energy and environmental law and policy research.

Deadline for manuscript submission: 1st of June 2018.

For more information, you may email to the IJE team: ije@purnomoyusgiantorocenter.org.

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AcademicCorner

The Determination of Energy Price

Figure 1. A standard supply and demand curve

The energy price is directly affected by the energy consumption used in the industry, household, commercial, electricity, and transportation sector. Due to its significant influence on the lives of many people, analysis of the energy price has to be well considered in the energy sector policymaking process.

The energy price is first determined by using a standard economic perspective from the supply and demand fundamentals. The optimum point from the supply and demand curve is often called “the Efficient Price” (see Figure 1). It represents the optimum resources allocation between the demand from the consumer and the supply from the producer. Understanding “the Efficient Price” mechanism is important for the government to determine the acceptable Economic Surplus (Economic Rent). The producer rent will be shared between government and producer through fiscal policy without inflicting any financial loss to the energy producer.

In the energy sector, “the Efficient Price” is merely an economic concept regarding the ideal price level. In reality, the price level in the market is shifted due to several distortions such as tax implementation, price subsidy, quantity limitation (quota) or direct price determination. With such distortions, the energy price is no longer an equilibrium price in the supply and demand curve. The distorted price is called “the Financial Price.” From the producer’s point of view, “the Financial Price” is the minimum level for the producer to produce a profit at the desired Rate-of-Return (ROR). While from the consumer’s point of view, “the Financial Price” is the maximum level that they are willing to pay the energy.

Thus, the calculation of “the Financial Price” is necessary for energy stakeholders. The calculation is important for the government to model its tax income plan and scenario. It is also an important aspect for energy producers. Given that energy industries are known for their vast capital amount and projects’ high risk, an analysis of “the Financial Price” is important to ensure sufficient capital return and to maintain their profit ratio is well above the production cost. The “Financial Price” can also guarantee the financial sustainability of the exploration and production stage of their project.

“The Financial Price” is used by the Government and the energy producer to make an analysis on the agreed price in the Cooperation Contract. However, the level of financial price in the upstream oil and gas industry depends on the form of the Cooperation Contract, such as Production Sharing Contract (PSC) based on the net split, Joint Operation Contract and Service Contract. Currently, the government is also implementing PSC based on the gross split. The contracts are varied for different projects and are based on their respective risk, business analysis, supporting infrastructure, regulations in place, as well as the type of resources. The differentiation was made to create an acceptable trade-off between both the government and investor’s responsibility. For example in Indonesia, there are different contract forms for different energy resources. In Indonesia’s coal mining sector, the implemented Cooperation Contract is called Perjanjian Karya Pengusaha Pertambangan Batubara (PKP2B) while in oil and gas industry, the Cooperation Contract is similar to the PSC Gross Split. These cooperation contracts are based on a certain royalty percentage from the gross income which is related to “the Financial Price” analysis result.

To summarize, "the Efficient Price" is an idealistic economic concept for energy stakeholders to consider in their decision-making process for energy pricing. Additionally, energy stakeholders should also calculate "the Financial Price" to determine the energy price. By assessing both of these prices, the government can model its tax income plan as well as other policy related to the energy sector, while energy industries can determine the financial security of their project. It is also important to note that “the Financial Price” is an essential factor to be considered to achieve an agreement in the Cooperation Contract between the government and the energy producer, in which the contract includes a certain royalty of the gross income from the natural resources production.

References

Yusgiantoro, P. (2009). Ekonomi Energi: Teori dan Praktik. Jakarta: LP3ES.

Yusgiantoro, P. (2018). Energy Pricing Policy. Presentation. Indonesia: Indonesia University of Defense.

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UPCOMINGEvent

COMING SOON IN APRIL & MAY 2018!

PYC KNOWLEDGE SHARING SESSION:

"THE ENERGY CONDITION IN INDONESIA:

AN ENERGY ECONOMICS PERSPECTIVE"

PYC will hold the second Knowledge Sharing Session in April 2018. In this session, the focus is to discuss the current situation of the energy sector in Indonesia under the perspective of energy economics. It will be moderated by several invited experts in energy economics in hope for participants to be able to learn, gain knowledge and discuss with these experts on the particular subject. We welcome participants coming from the various background, from university, government agency, to representatives from industries. For more updates on this event, please stay tuned at www.purnomoyusgiantorocenter.org.

PYC ENERGY WORKSHOP:

“ENERGY DATA ANALYSIS USING STATA – BASIC LEVEL”

Our 1st part of PYC Energy Workshop will take place this May 2018. This workshop aims to provide a comprehensive training and good practices related to energy and natural resources data analysis. The training will focus on basic modeling and analysis of energy economics data using STATA (Data Analysis and Statistical Software). STATA is a powerful and complete statistical software that enables users to analyze, manage, and produce graphical visualizations of the data. Workshop participants are expected to be able to operate the STATA independently and perform basic analysis after the session ends. Updates about the workshop will be available at the beginning of April 2018 through our website: www.purnomoyusgiantorocenter.org. We look forward to you to join!

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More from Us

WE ARE HIRING FOR 2018!

We are hiring:

Economic Research Assistant (ECONRES-FT)

and

Accounting Staff (ACC-FT)

Be a part of the PYC team!

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Purnomo Yusgiantoro Center
Jalan Wijaya IX No. 12, Kebayoran Baru, Jakarta, 12160, Indonesia
Phone: +62 21 720 3917
Fax: +62 21 22 77 5786
Email: pyc@purnomoyusgiantorocenter.org 

Website: www.purnomoyusgiantorocenter.org | www.pyc-conferences.org | www.ije-pyc.org

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