Indonesia is setting a three-year deadline for all state-owned enterprises (SOEs) to use only electric vehicles (EVs), as reported by Bloomberg on October 17. SOEs may choose to rent EVs or borrow funds to purchase EVs to meet the requirement. The Indonesian government will also prompt state-run bus operators Perum PPD and DAMRI to fully electrify their fleet without setting a specific timeline, according to the country’s SOE Minister Erick Thohir. The upcoming electrification in the bus sector is estimated to involve about 3,500 buses.

As the world’s largest nickel producer, Indonesia seeks to make use of its rich natural resources to become a regional manufacturing and exporting hub for EVs, batteries, and other EV components. On the other hand, transportation accounts for a quarter of Indonesia’s energy-related emissions, hence switching to electric cars could advance the country’s net-zero emissions target. Over the next several years, Indonesia hopes to attract total investments of at least USD15bn to establish 140 gigawatt-hours (GWh) of annual EV battery-producing capacity. Moreover, the government is planning on subsidizing purchases of EVs from next year to stimulate sales, aiming to have 2m electric motorcycles and 500,000 electric cars on the road by 2025. As of October 2022, the country only had around 28,188 EVs, including 22,942 motorcycles and 4,904 cars, mainly due to a lack of government subsidies.

Sources:

https://www.bloomberg.com/news/articles/2022-10-17/indonesia-s-state-firms-to-use-only-evs-by-2025-in-net-zero-push?srnd=premium-asia

https://www.just-auto.com/analysis/indonesia-steps-up-ev-sector-expansion/

https://www.bloomberg.com/news/articles/2022-10-09/indonesia-may-start-ev-purchase-subsidies-in-2023-to-spur-sales?srnd=premium-asia&leadSource=uverify%20wallhttps://www.nst.com.my/world/region/2022/10/837323/indonesia-aims-two-million-electric-motorcycles-road-2025