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Towards an Effective Road Transport Fleet Renewal Strategy for Indonesia

Editor

Listed:
  • Alloysius Joko Purwanto
  • Ryan Wiratama Bhaskara
  • Laksmita Dwi Hersaputri
  • Shafa Nabilla Haya
  • Pusat Studi Energi Universitas Gadjah Mada

Author

Listed:
  • Alloysius Joko Purwanto

    (Economic Research Institute for ASEAN and East Asia (ERIA))

  • Ryan Wiratama Bhaskara

    (Economic Research Institute for ASEAN and East Asia (ERIA))

  • Laksmita Dwi Hersaputri

    (Economic Research Institute for ASEAN and East Asia (ERIA))

  • Shafa Nabilla Haya

    (Economic Research Institute for ASEAN and East Asia (ERIA))

  • Pusat Studi Energi Universitas Gadjah Mada Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract

The transport sector plays a central role in Indonesia's decarbonisation efforts, particularly road transport, which accounts for around 24% of national emissions. This is driven by rapid growth in vehicle ownership and continued reliance on fossil fuels. A key challenge exacerbating emissions is the large share of old and inefficient vehicles. Indonesia currently lacks a structured fleet renewal and vehicle retirement policy, resulting in the persistent accumulation of outdated, high-emission vehicles within the national fleet. Focusing on private passenger cars, this study employs a population-based model to estimate the costs and benefits of different fleet renewal strategies. It simulates a range of scenarios, including varying combinations of standards, subsidies, regulations, taxes, and scrappage programmes. The study concludes with a set of regulatory improvements and policy recommendations. To support these, it includes a comprehensive regulatory mapping, international benchmarking, and gap analysis of Indonesia's existing legal framework and policy initiatives related to cleaner vehicle adoption and the retirement of high-emission legacy vehicles.

Suggested Citation

  • Alloysius Joko Purwanto & Ryan Wiratama Bhaskara & Laksmita Dwi Hersaputri & Shafa Nabilla Haya & Pusat Studi Energi Universitas Gadjah Mada Economic Research Institute for ASEAN and East Asia (ERIA), 2026. "Towards an Effective Road Transport Fleet Renewal Strategy for Indonesia," Books, Economic Research Institute for ASEAN and East Asia (ERIA), number 2026-RPR-06 edited by Alloysius Joko Purwanto & Ryan Wiratama Bhaskara & Laksmita Dwi Hersaputri & Shafa Nabilla Haya & Pu, October.
    • Handle: RePEc:era:eriabk:2026-rpr-06
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    File URL: https://www.eria.org/uploads/Towards-an-Effective-Road-Transport-Fleet-Renewal-Strategy-for-Indonesia.pdf/
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