Abstract
This paper examines the implications of SO 2 emission mitigation constraints in the power sector planning in Indonesia—a developing country—during 2003–2017 from a long term integrated resource planning perspective. A decomposition model is developed to assess the contributions of supply- and demand-side effects to the total changes in CO 2, SO 2 and NO x emissions from the power sector due to constraints on SO 2 emissions. The results of the study show that both the supply- and demand-side effects would act towards the reduction of CO 2, SO 2 and NO x emissions. However, the supply-side effect would play the dominant role in emission mitigations from the power sector in Indonesia. The average incremental SO 2 abatement cost would increase from US$ 970 to US$ 1271 per ton of SO 2, while electricity price would increase by 2–18% if the annual SO 2 emission reduction target is increased from 10% to 25%.
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