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Assessing Low Carbon and Resilient Growth in Indonesia: An application of the ThreeME model

Author

Listed:
  • Reynès Frédéric G.
  • Paul Malliet

    (EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

Abstract

This report o ers an empirical applica on of the no on of energy transi on to the Indonesian economy by simula ng the medium- and long-term impacts of proposed investment plan in power genera on capaci es on the Indonesian economy. The star ng point of the analysis comes from ThreeME framework, a Mul -sectoral Macroeconomic Model based on Keynesian theory. It is designed to address dynamics of global economic ac vity, energy system development and carbon emissions causing climate change. The ThreeME model is well suited for policy assessment purposes in the context of developing economies as it informs the transi onal e ects of policy interven on. In par cular, disequilibrium can arise in the form of involuntary unemployment, iner a of technical systems and rigidity of labor and energy markets, as a result of delayed market- clearing in the goods markets and slow adjustment between prices and quan es over the simula on me path. Calibrated using sectorial and aggregated na onal accounts data, an Indonesian version of the ThreeME has been developed and accounts for 37 commodi es -including 4 energy sources- and 44 sectors, with an explicit dis nc on between 11 energy sectors and 4 transport sectors. Electricity produc on is disaggregated into 8 technologies: hydro, geothermal, wind, solar, nuclear, coal-based, oil-based and gas- based. A disaggrega on between 5 regions is also made. The ThreeME-Indonesia model is used to gauge the economic and environmental e ects of energy and scal policy measures in Indonesia at the na onal and regional levels. Di erent policy scenarios are assessed, each re ec ng the impact of investments in electricity produc on capaci es. This document is the result of an 18 months' research collabora on involving the Ministry of Na onal Development Planning (BAPPENAS), the French Agency for Development (AFD), the French Economic Observatory (OFCE), the Netherlands Organiza on for Applied Scien c Research (TNO) and the Center for Economics and Development Studies from the Padjadjaran University (CEDS).

Suggested Citation

  • Reynès Frédéric G. & Paul Malliet, 2017. "Assessing Low Carbon and Resilient Growth in Indonesia: An application of the ThreeME model," Working Papers hal-01708487, HAL.
    • Handle: RePEc:hal:wpaper:hal-01708487
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    Cited by:

    1. repec:hal:spmain:info:hdl:2441/11505qn4ak95irt0cafaeim81j is not listed on IDEAS
    2. Paul Malliet & Frédéric Reynès & Gissela Landa & Meriem Hamdi-Cherif & Aurélien Saussay, 2020. "Assessing Short-Term and Long-Term Economic and Environmental Effects of the COVID-19 Crisis in France," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(4), pages 867-883, August.
    3. Bulavskaya, Tatyana & Reynès, Frédéric, 2018. "Job creation and economic impact of renewable energy in the Netherlands," Renewable Energy, Elsevier, vol. 119(C), pages 528-538.
    4. repec:hal:spmain:info:hdl:2441/6neh4df2kq9orrjiscv6839f6n is not listed on IDEAS
    5. Tatyana Bulavskaya & Frédéric Reynés, 2018. "Job creation and economic impact of renewable energy in Netherlands," Post-Print hal-03458307, HAL.
    6. Tatyana Bulavskaya & Frédéric Reynés, 2018. "Job creation and economic impact of renewable energy in Netherlands," SciencePo Working papers Main hal-03458307, HAL.

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