Abstract
The use of fossil energy in Indonesia has been constantly increasing, especially on the manufacturing industry, the largest contributor to Indonesia's gross domestic product (GDP). Meanwhile, Indonesia's fossil energy reserve has been declining. Energy efficiency is one of the solutions to maintaining the industry's output. This research looks into the structures of Indonesia's manufacturing industry based on its energy use and how the industry has been conducting energy efficiency policies from time to time.Keywords: Energy efficiency, decomposition analysis, Indonesia, manufacturing industryJEL Classifications: L60, Q28, Q4DOI: https://doi.org/10.32479/ijeep.11395
Highlights
Energy is a crucial factor in the economic development and growth of a country, supporting economic activities like production and consumption
Analysis of Energy Intensity based on Sub-sectors of the Manufacturing Industry Some uses of energy intensity can describe indicators like changes in energy uses and components, explaining to the general public about the cause of change in energy intensity, providing inputs for programs and policy analysis, as well as increasing understanding on the importance of efficiency improvement
This indicates that the manufacturing industry had improved its energy efficiency, meaning that the ratio between energy consumption and production output had been narrowing
Summary
Energy is a crucial factor in the economic development and growth of a country, supporting economic activities like production and consumption. Indonesia is faced with ever-increasing energy consumption issue, which is dominated by oil, gas, and coal Up to this day, Indonesia is still utilizing these non-renewable resources as primary energy sources in vital sectors, such as electricity, industry, and transportation. Energy use from 1990 to 2018 increased by 4.99% per year (International Energy Agency (IEA), 2019), in line with the average annual economic growth of 5.03% This has brought Indonesia closer and closer to fossil energy scarcity, pushing it to import more oil and gas. The Ministry of Energy and Mineral Resources (MEMR) (2009) stated that fossil energy reserve in the country will be exhausted in 23 years (oil), 59 years (gas), and 82 years (coal) These calculations assume that no more new sources will be discovered, which otherwise will improve and prolong the energy reserve. Based on the predetermined research objects, this paper will be divided into five chapters, namely the introduction, literature review, data and methodology, results, and conclusion and recommendation based on the research’s results
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