Abstract
This study examines the effect of the low-cost green car (LCGC) policy that was introduced to control emissions from passenger vehicles in Indonesia. We examine the policy’s effectiveness by estimating the level of emissions of CO, HC, NO, CO2 under two scenarios: with and without LCGCs. The affordable price of LCGCs and the strict enforcement of the vehicle purchase system led us to estimate the growth in the number of vehicles using minimum annual income as a measure of people’s ability to buy a new car. An annual income of US$4,500–$10,000 was considered to represent the people who could buy an LCGC. Annual travel distance was obtained from a survey of drivers, and the deterioration factor from the Euro 2 standard was used. The results showed that the LCGC policy will potentially cause a significant increase in emissions of CO, HC, and NO by 2030. The LCGC scenario predicted 1,389.7, 31.0, and 279.5 tons of CO, NO, and HC, respectively, compared with 670.3, 15.1, and 136.6 tons, respectively, for the scenario without LCGCs, an increase of 51.7%, 48%, and 51.2%, respectively. For amount of CO2, although LCGC policy could save more than 104,881 tons, the gap is increasing until end of projection in 2030, 3.3 times bigger between corresponding year, 49,411 tons and 14,892 tons for with and without LCGC policy, respectively.
Highlights
In September 2013, the Indonesian government launched a new policy known as low-cost green car (LCGC) after a one-year delay
According to data provided by the CDIAC (2013), Indonesia was ranked 12th in the world in terms of CO2 emissions
While we focus on Euro cars, non-Euro cars must be considered because of their emissions, current condition, and numbers remaining in the market, as there is no regulation limiting the life of vehicles in Indonesia
Summary
In September 2013, the Indonesian government launched a new policy known as low-cost green car (LCGC) after a one-year delay. The fuel specification is based on a Research Octane Number of 90 for gasoline and a Cetane Number of 51 for diesel with a maximum wheel handle turning radius of 4.6 meters This turning radius reflects the size of the LCGCs, because cars usually have a turning radius of more than 4.7 meters (MOE 2003). All owners of vehicles fulfilling this requirement will receive an incentive in the form of a tax cut (MOI 2013) This regulation has been introduced in response to the decline in domestic oil reserves and the high level of consumption in the transportation sector. These concerns have been exacerbated by the growth in the number of passenger vehicles, with the total number tripling between 2001 and 2012 (Gaikindo 2015). One of Indonesia’s main sources of CO2 emissions is the consumption of liquid petroleum products, which accounted for more than 36% of total emissions (CDIAC 2013)
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