Mapping Indonesia’s EV Potential in Global EV Supply Chain

Abstract

• Energy transition in the transportation sector is indicated by the gradual shifting from the use of internal combustion engine (ICE) vehicles to electric vehicles (EVs) globally. • The transportation sector consumed 43% of total global energy and emitted 16.2% of total global emissions in 2020. Similarly, the transportation sector in Indonesia consumed 45% of the total energy and contributed to 13.6% of CO2 emission in 2019. • Global EV development and utilization are increasing exponentially, especially in developed countries, and there were 10 million EVs in 2020 worldwide. • China has successfully dominated global EVs, both in EV utilization and manufacturing with 45% global EVs Stock and 77% global EV batteries production. • Geopolitically, the abundance of Indonesian nickel reserves provides Indonesia a great opportunity to be one of the main players in EV battery manufacturing. • With an annual average growth of 6%, the projected motorized vehicles growth in Indonesia will reach 214 million in 2030. The right government policies would make Indonesia become the Southeast Asia EV market hub as Indonesia has the largest automotive sales and production market among ASEAN countries. • Measurable and realistic national EV development targets and plans supported by executing policies such as fiscal incentives and hardware standardization, sufficient EV charging infrastructure, and other supporting infrastructures are key elements that drive successful EV development in several countries. • Insufficient domestic industries and technology, and the absence of policies that comprehensively cover the customers and producers directly to support EV development and utilization in Indonesia, resulting in the achieved number of EVs and EV infrastructures in Indonesia are far from the updated target or even the initial target (RUEN, 2017).