Introduction

Electric vehicles (EV) from China are gaining popularity in Indonesia, with 66% of consumers viewing them positively. This is driven by their affordability, innovative features and comfort.

Wuling Motors leads as Indonesia’s most popular EV brand, winning awards and achieving high sales. Other Chinese brands like BYD, DFSK, Seres, Chery and Neta are also making significant strides in the market.

This has been facilitated by the Indonesian government that is actively supporting EV adoption through substantial subsidies and incentives, totaling US$445.6 million, and has attracted large investments, such as the US$1.3 billion from BYD. Local production initiatives – such as Chery’s in Bekasi – and partnerships like Sokonindo aim to bolster Indonesia’s position in the global EV supply chain.

The focus extends to electric motorcycles, with several manufacturers establishing factories in Indonesia. PT. Sunra Asia Pacific Hi-Tech, PT. RPM and PT. Yadea Teknologi Indonesia are leading this initiative, with Luyuan planning a significant market entry through domestic partnerships.

Agreements

The influx of Chinese EV manufacturers into Indonesia is a result of recent cooperation agreements between the two countries, which have spurred efforts to enhance investment cooperation, particularly in EV batteries, automotive manufacturing and spare parts production. This is reflected in an MoU signed during Jokowi’s visit to Beijing in 2023. However, discussions on EV cooperation had been ongoing between the two countries since before this visit.

Furthermore, B2B collaborations have been established – such as between China’s GAC Aion New Energy Automobile Co. Ltd. and Indonesia’s PT. Indomobil Energi Baru – to distribute GAC Aion EV in Indonesia. This partnership aims to provide environmentally friendly vehicles including sedans, SUVs and supercars.

Additionally, another Chinese company, Zeekr, has partnered with PT. Premium Auto Prima as the Brand Holder Agent (APM) to introduce SUV and MPV models in Indonesia.

Other renowned manufacturers like Great Wall Motor will also enter the Indonesian automotive market in the second quarter of 2024 with a specific focus on hybrid models.

The growing entry of Chinese can also be attributed to the government’s efforts to revise the incentive scheme for electric vehicle manufacturers, such as relaxing VAT taxes, adjusting the Domestic Component Level and relaxing Completely Built Up (CBU) vehicle imports, all of which aim to attract foreign investors to invest in the country.

This also causes Chinese EVs to flood the Indonesian market compared to products from Japan or South Korea. This popularity is due to the low price of Chinese EVs compared to the price set by producers from other countries. In fact, Chinese EVs are even cheaper than normal cars in circulation today. This competitive price can be attributed to low production costs and component quality.

The increasing popularity of Chinese EVs in Indonesia actually plays well into the government’s goals to reduce independency on fossil fuel and facilitate transition to greener energy sources. This does not necessarily mean that normal vehicles will stop circulating, though EVs might very well overtake total sales due to their energy efficiency and low cost. To reach that point, however, there needs to be a shift in consumers’ attitude towards EV and willingness to abandon dependency on fossil fuel, as well as a wider awareness campaign on sustainability agenda. In other words, consumers need to be convinced why they need to shift to EV.

Challenges

The use of EVs in Indonesia still faces a number of challenges. For example, 71.2% of respondents in a survey two years ago considered it difficult to find public EV charging stations. This concern proves true even today, as charging stations remain limited an unequally distributed.

As of April 2024, the number of charging station stood at 1,380 units and almost half (656) were located in Java. Interestingly, charging stations remain limited in Sulawesi and Maluku, the two places where Indonesia’s nickels are mined and processed. This seems to suggest that the local population has not really benefitted from the downstream products of nickel extracted from their areas.

Moreover, 62% of respondents expressed concerns about the high price and maintenance cost, which goes to show their unfamiliarity with the minimum cost of charging an EV. In addition, a number of respondents also acknowledged the limited range and distance that EVS can cover as well as concerns about the long charging time for EV battery.

Another challenge concerns the handling of battery waste. The government needs to be more proactive and agile in creating clear regulations regarding the processing of battery waste, whether they will be recycled or repurposed to support sustainable battery use. Without clear regulations and adequate supervision, battery waste could potentially lead to new environmental issues.

Besides, the burgeoning presence of Chinese EVs in Indonesia could have several implications on the latter’s political and economic landscape.

Firstly, it would create inconsistent policy dynamics. The competition between manufacturers from China and other countries over EV imports and production would result in the inconsistencies of Indonesia’s policy frameworks, as manufacturers from Japan and South Korea would require different conditions. This lack of coherence in policies can lead to uncertainties for investors and hinder the sector’s sustainable growth as well as competitiveness.

Another important point is concerns over the exploitation of nickel resources in Indonesia, a crucial component for EV batteries. Indonesia’s abundant nickel reserves present a double-edged sword in the context of EV production. The rush to exploit nickel reserves without standardized environmental and labor regulations raises significant concerns about sustainability and social responsibility. The lack of standardized practices combined with the prevalence of cheap nickel prices raise concerns about environmental sustainability and fair economic practices. Indonesia risks becoming merely a raw material supplier without substantial value addition if proper regulations and strategic industrial policies are not implemented.

Moreover, Indonesia’s role in the EV supply chain is predominantly assembly, with the more technologically advanced components such as batteries and core EV technologies sourced from China. This condition limits Indonesia’s ability to capture higher value-added segments of the EV market, reinforcing dependency on foreign technological expertise and potentially stifling local innovation and industrial growth.

Related to this, the intensifying entry of Chinese EVs could increase Indonesia’s reliance on China. This dependency could include crucial components like batteries, electric drivetrain technologies and charging infrastructure, all primarily sourced from China. This would deepen Indonesia’s dependency on Chinese industrial strategies and market dynamics, potentially limiting its autonomy in shaping domestic EV policies and priorities. If, for example, China’s domestic market is shaken by geopolitical tension, its impacts would reverberate across Indonesia’s EV market.

Another concern relates to the recent announcement by the Indonesian government to implement up to 200% increase in import duty on textile products from China. This might induce a modicum of anxiety on Chinese exporters from all industries and sectors, including EV producers, if not communicated and managed well. For now, however, the impact of this announcement on the EV sector remains to be seen.

Lastly, EV is in no way going to be a panacea to the urban congestion problem in Indonesia’s major cities. The emphasis on increasing private EV ownership, as opposed to developing an effective public transportation system, could exacerbate traffic jam, air pollution and economic loss in Indonesian cities. Campaign for EV adoption, therefore, must be accompanied by complementary infrastructure development and policy measures to tackle multidimensional problems in Indonesia’s transportation sector.

Conclusion

Indonesia needs coherent policies amidst the influx of Chinese EVs and lack of competition in the sector. Clear policies are vital to attract investments and foster industrial growth.

Addressing nickel resource exploitation is critical. Indonesia should adopt standardized mining practices and fair pricing mechanisms to sustainably manage its reserves, minimizing environmental impact and maximizing economic benefits.

To strengthen its EV supply chain role, Indonesia must focus on developing domestic capabilities beyond just assembly. This includes technology partnerships, R&D in EV components like batteries and incentives for local innovation to reduce reliance on foreign technologies and enhance economic gains. Rather than solely promoting private EV ownership, Indonesia should prioritize enhancing public transportation infrastructure and technologies. This approach – involving investments in mass transit, adopting EVs for its public transport fleets and promoting sustainable mobility solutions – can ease urban congestion and lower emissions.

Introduction

It is proven that climate change effects are interconnected with the many environmental issues that humans will eventually suffer from. In recent decades, climate change has become one of the major global security problems as it is known to cause human and social insecurities such as poverty, floods, endemics, transboundary haze, pollutants, deforestation, etc. These challenges are often categorised as non-traditional security threats that this region is especially prone to. However, as a small state, Brunei is more vulnerable to these challenges. The law of unintended consequences is real, and if Brunei is slow in tackling climate change and its associated challenges with full conviction and in the near future, it will be severely impacted with environmental vulnerabilities particularly in ecosystem vitalities and environmental health.

With Brunei chairing the ASEAN Summit this year and as part of its agenda, the country has been at the forefront to tackle climate change that is in accordance with the Paris Agreement. The ASEAN Member States (AMS) adopted the Bandar Seri Begawan Joint Declaration on Energy Security and Energy Transition, which reaffirmed the shared commitments and responsibilities of ASEAN member states to pursue alternative and cleaner low-carbon energy footprint in the region. This initiative which includes mitigating environmental issues has to be a collective effort from the AMS; with a people-to-people approach that ranges from individual, community, state actors, nonstate actors, and big companies, among others. In fact, the potential impacts of environmental degradation caused by climate change should not be understated. According to the UN, climate change has been recognised as a ‘threat multiplier’, which necessitates the urgency to integrate it into the existing security policy agenda.

Brunei’s Looming Threats: Geography and Increasing Urbanisation

Brunei’s 7^th ranking in the 2020 World Risk Report is indicative of its high risk of exposure to climate change uncertainties. This would be exacerbated by the increasing urbanisation. Unfortunately, it appears that those living in urban areas are often the most affected by natural disasters. In 2019, the total population of urban areas in Brunei was 77.94%. This means that a majority of Bruneians are now dependent on the easy access to amenities such as clean water, electricity, internet services, and roads. However, some of these areas are prone to issues such as flash floods, open burning, and intermittent access to clean water.

Brunei’s geographical location such as its long coastline exposes the country to many environmental issues. Alarmingly, the occurrences of flash floods have recently spiked due to the rise in sea level and a gradual increase in the temperature. Additionally, in August 2021, the unpredictable weather condition saw several low-land areas such as in Belait and Tutong districts affected by flood.

Conversely, global warming has caused a longer spell of dry season that led to forest fires, especially in the middle of the year. In 2020, over 500 hectares of land were destroyed by forest fire due to the extreme heat which contributed to the haze problem and air pollution. In a related issue, Brunei’s peatlands are also at risk due to forest fires, poor management, lack of knowledge, and drainage issues. The irreplaceable peatlands play an important function in the maintenance of global biodiversity. Currently, 10% or about 32.94 million hectares of the world’s peatland is found in this region. If Brunei’s peatlands are not protected, its pristine rainforests will be at further risk of destruction.

Collectively, these warrant Brunei to rethink its overall environmental and human security policy. It is, thus, timely to now include non-governmental organizations to mitigate this existential crisis.

The Answer: Whole of Nation Approach, Environmental NGOs (ENGOs) and Climate Change Mitigation

A whole of nation approach is essential in mitigating climate change. This people-to-people approach engages the society, especially non-governmental organisations (NGOs), to participate in building national policy. Additionally, environmental NGOs (ENGOs) are arguably the backbone of the government in mitigating climate change as they work closely with the government, grassroots level, and other NGOs. They often inspire government activities and support relevant government agencies in mitigating environmental issues. Brunei is currently adopting this holistic approach to mitigate climate change by engaging society and other concerned organisations. This includes the government educating the society to be environmentally aware through cooperation, collaboration, and by empowering them to work and collaborate with relevant government agencies.

There are several notable instances of such an approach being put into practice in Brunei. One of the best examples is when ENGOs voluntarily, actively involved in efforts to achieve the Sustainable Development Goals (SDGs). The national review report presented at the 2020 UN High-Level Political Forum on Sustainable Development is the best example of people-to-people interaction in the country. In the report, ENGOs were highlighted to be assisting the government achieve SDG 12 (responsible consumption and production), SDG 13 (climate action), SDG 14 (conserve and sustainable use of the oceans, seas, and marine resources), and SDG 15: (life on land). The national review report also revealed that the Brunei Climate Change Secretariat (BCCS) and Green Brunei, an inspiring ENGO towards green movement and sustainability, were working together to address SDG 13. Through such endeavours, NGOs can also help the government in educating the society to be more environmentally good citizens in the future.

Brunei’s Commitment at National and International Platforms

At the state and regional level, the narrative of becoming good environmental citizens was developed by the government’s initiative in the Sustainable Development Program which started in 1991. Since then, Bruneian’s environmental awareness has heightened, and Brunei’s national and international environmental initiatives have been solidified.  One example is Brunei’s international commitment in the Multilateral Environmental Agreements (MEAs), an international initiative to combat environmental issues. These agreements include Brunei’s membership in the Montreal Protocol in 1993, United Nations Framework Convention on Climate Change (UNFCCC) in 2007, Kyoto Protocol in 2009, and Paris Agreement in 2015. The challenge for Brunei now is to find solutions at the state level to overcome climate change vulnerabilities that can impact the country’s future development. Since 2007, Brunei has invested in achieving the Brunei Vision 2035. However a question still lies—can national climate change be mitigated with this vision? The solution lies in educating and working together with its society.

The Paris Agreement is one of the most important agreements Brunei is affiliated with as it allowed ENGOs to work closely with the government. According to the Ministry of Energy in the opening remarks of the Paris Agreement in 2016, while Brunei only contributes 0.016% of total global emissions, it is still obliged to be part of mitigating climate change. Brunei as an oil-producing country is, however, suspected of consuming more energy than others. This inevitably makes the country a significant contributor to the progression of climate change. Additionally, Brunei has experienced various social and economic developments. Urbanisation, physical infrastructure, construction, and strong GDP per capita have led to higher consumption and operational activities. Consequently, Brunei has recorded the highest number of cars in operation in Southeast Asia with 721 per 1,000 cars in 2020. Also, Brunei’s per capita carbon dioxide emissions are higher than average in 2020, with 15.2 metric tons per person.

Conclusion

The establishment of the BCCS in 2018 was part of Brunei’s solution to mitigate the aforementioned environmental vulnerabilities. The BCCS is believed to be capable of evaluating climate change and other human and economic activities. However, similar with many other developing economies, Brunei’s resources are still of high economic interest. Fossil fuel, oil, and gas remain the best economic alternative to generate power to the state. Of these resources, fossil fuel is primarily used by Brunei to generate electricity. Though this is sustainable economically, but will it be sustainable to mitigate climate change?

Unfortunately, with the current COVID-19 development in Brunei, the demand for electricity skyrocketed especially for home users as the population works from home. This reinforces Brunei’s dependency on electricity as its main power resource. Nevertheless, Brunei is aware of the current magnitude that global warming has brought towards the tiny state. The disproportionate effects of climate change are disconcerting as it affects the earth’s natural systems that are attributed towards global warming such as the incidence of tropical storms or delays in wet seasons. As part of the initiative to reduce carbon emission, Brunei has developed a practical national strategy that corresponds with its economic development. As part of its strategy, Brunei is committed to reducing carbon emission largely generated from power utilities by at least 10% in the year 2035.

Sponsored Article in Commemoration of Earth Day 2021

Introduction

The COVID-19 pandemic has not only disrupted businesses globally but also numerous sustainability projects and climate change mitigation goals. Notably, action against climate change is one of UN’s 17 Sustainable Development Goals (SDGs). This is rather concerning as to avoid the worst impacts of climate change and for global temperature to stay within 2 degrees Celsius by 2100, global emissions must be reduced to zero by 2030.

For land-scarce Singapore, climate change is an existential threat, given its small size and geographical location near the equator, a hotbed region for tropical storms.  Almost a decade ago, Prime Minister Lee Hsien Loong expressed his desire for citizens to take up ownership of the environment and approach climate change by adapting the ‘Total Defence’ strategy at the launch of the Clean and Green Singapore 2011 campaign. Eight years later, Prime Minister Lee reiterated in his 2019 National Day Rally that “Both the SAF (Singapore Armed Forces) and climate change defences are existential for us. These are life and death matters.”   Clearly, local policymakers are not sitting on their hands when it comes to climate change.

Yet current policy measures have not translated into sustainable results. Singapore may have contributed to 0.11% of global emissions in 2018 compared to China’s 30%, but emissions per capita is at 8.56 tons per capita, making Singapore 27^th out of 142 countries based on IEA data from 2018, worse than China’s 7.95 tons per capita and 39^th spot in the same report. The annual transboundary haze affecting Singapore, Malaysia and Indonesia continues unabated without a definite solution, a sign that the region as a whole is not meeting its target for climate change mitigation. Noteworthily, COVID-19 has made food security a higher priority concern for Singapore, especially when 90% of its food is imported and subjected to the volatilities of the global food market, including climate change and the pandemic.

Here, Biochar is proposed as a potential solution applicable to Singapore and Southeast Asia to climate change, food security and energy needs.

Biochar: A Carbon-sequestering, Nutrient-rich Resource

Biochar is a fine-grained, highly porous charcoal that helps soils retain nutrients and water. It is produced using pyrolysis by subjecting organic wastes to high temperature in an oxygen-deprived environment, while generating useful by-products to be reused for energy or component refining for industrial chemicals. The end-product has carbon as the main constituent, with other plant nutrient chemicals in variable composition. Application of biochar to soil is a carbon negative process, since carbon in biochar is more recalcitrant than the natural environment and will remain in the ground longer, without adding to the atmospheric carbon dioxide.

Biochar is particularly beneficial in agriculture. Farmers have a vested interest in increasing and maintaining the soil carbon in their fields as studies have shown a correlation between soil carbon levels and crop yield. Organic soil carbon plays an important role in the chemical composition and biological productivity in soil, which includes fertility and nutrient holding capacity. Biochar have been shown to improve crop production in maize, wheat, rice, oil palm, soybean, all of which are major crops and oilseeds used globally. Additionally, biochar can reduce surface runoff, and therefore nutrient leaching ,and promote more stable soil structure.

From research, Biochar has other interesting uses such as the removal of Volatile Organic Compounds (VOCs), chemicals harmful to human health, from buildings, a potential building material that can strengthen concrete, and  a novel method to sequester carbon in concrete. Notably, biochar is significant in the recovery of washed-off fertilizer chemicals.  Water hyacinths used in the clean-up of fertilizer chemical contaminants in freshwater bodies are ideal materials for biochar production. Therefore, a future circular economy is envisioned, with environment sustainability at its core: remediation service, fertilizer chemical recovery and reuse, biochar production, and climate change mitigation through carbon sequestration.

A Potential Solution to Three Existential Threats

1) Climate Change Mitigation

With is carbon sequestering properties, Biochar can potentially remove up to 1.1 billion ton of CO2 per annum globally. Currently, Singapore has implemented a carbon tax of SGD$5 (~USD$3.80) per ton of Green House Gases (GHG) released for the period of 2019 to 2023, with plans to review the tax thereafter, and an end-goal of between SGD$10 to SGD$15 by 2030. By investing carbon taxes into carbon sequestration projects such as biochar production and selling it as carbon credits to other nations or corporations creates a win-win situation for everyone including the environment. One such project would be a biochar commercial plant in Johor, initiated by JTS Optimax Pte. Ltd., a Singapore-based start-up with the goal of converting oil palm waste in Malaysia to biochar and electricity.

Singapore can benefit economically from funding such projects  while exporting biochar-based technologies to neighbouring countries. One significant contribution could be the mitigation of the  transboundary haze crisis  by converting the large volume of agricultural waste material in the region into biochar instead of resorting to slash-and-burn. Not only will it entail a low-cost production of biochar, but also the production of electricity that could be supplied to rural areas. Additionally, biochar can generate a calculated agriculture value of between USD2.30 and 3.30 per hectare  while reducing fertilizer transportation and spreading costs. Amongst Southeast Asian nations, Philippines has been actively using biochar to remediate mining grounds and prepare rehabilitated grounds for replanting. Malaysia, Vietnam and Indonesia are each making inroads into biochar usage and production as well.

2) Food security

Singapore has signed an Agreement on the ASEAN Food Security Reserve which included the ASEAN Emergency Rice Reserve in October 1979. Despite the pact, agriculture activities in Singapore declined from the 1980s as food import became the cheaper and pragmatic option. In 2019, Singapore Food Agency has set a target of achieving 30% of the country’s nutritional needs through local means by 2030. However, this goal is not enough to ensure food security.

Biochar can provide a win-win strategy for food security. Being alkaline in nature, biochar can deacidify soil, thereby maintaining and saving scarce local arable land from fertilizer overuse through the direct application of Nitrogen-Phosphorous-Potassium (NPK) nutrients. Additionally, direct uptake of biochar carbon by fungi crops and the use of biochar as scaffold for beneficial micro-organisms promote crop growth. More importantly, biochar indirectly improves crop production by reducing soil-borne plant diseases and promoting beneficial soil bacteria growth, thereby boosting soil health.

Biochar research in hydroponics has also shown that not only half of the growth substrate can be replaced with biochar and crop growth can be enhanced, but harmful algal growth can be reduced with its application. By replacing half of the Perlite or woodchip growth substrate with biochar will lead to significant production cost reductions for hydroponics farms which can promote price competitiveness with conventional soil-grown crops. However, proper application must be done to ensure the crops receive all the nutrients as biochar can act as a sponge for absorption of water and chemicals. Collectively, this means that with care, biochar can also be used in conjunction with Singapore’s current food security strategy of local vertical and indoor farming.

3) Sustainable Energy Needs

In fulfilment of the UN Sustainable Development Goals, Singapore has explored ways to source for more sustainable energy to satisfy the needs of the populace, including importing energy from Malaysia in a trial run. This is on top of increasing solar panel usage locally on HDB rooftops. Given the production of biochar yields sustainable energy production, this is one potential alternative source in which Singapore can import from Malaysia as well.

Therefore, biochar can directly and indirectly address existential threats to Southeast Asia namely, climate change, food security and sustainable energy needs. It is, thus, timely to incorporate biochar into national strategies to ensure a sustainable future.