Kaleidoscope 2023: A Series Of Government Policies To Encourage Electric Motor Conversion

JAKARTA - The government continues to boost the use of battery-based electric vehicles in the country. The target is 6 million electric motors operating by 2025.

To accelerate the distribution of electric vehicles, the Ministry of Energy and Mineral Resources has issued a conversion program for fuel-fueled motorcycles into battery-fueled motorcycles.

The program, which has started since 2022, was originally targeted at 1000 conversion motors, then increased to 50,000 conversion motors by 2023.

The Ministry of Energy and Mineral Resources hopes that this program can be an attraction to encourage the growth of the independent electric motor vehicle industry in Indonesia. In addition, the increasing public interest in electric vehicles can also increase the competitiveness of the domestic industry.

Director of Conservation of the Ministry of Energy and Mineral Resources (ESDM) Gigih Udi Atmo claims that the use of conversion motorbikes can save costs that are usually spent on buying fuel oil. Simulating, if per day conventional motorcycles charge pertalite 1 liter fuel, then in a month the expenditure for fuel is IDR 300,000.

But when compared to a conversion electric motor, in a month the expenditure for fuel only costs around Rp. 60,000, or there is a savings of 80 percent every month. To encourage the development of motor conversion.

The following are the steps and policies issued by the government during 2023:

1. Provide Electric Motor Conversion Training

The Ministry of Energy and Mineral Resources (ESDM) provides technical training for the conversion of fuel motorcycles into electric motorcycles to workshop owners throughout Indonesia.

The Ministry of Energy and Mineral Resources has collaborated with Small and Medium Enterprises (SMEs) workshops to conduct training on converting fuel motors to electricity. Cooperation with component manufacturers is also carried out to get economical component prices.

As of November 7, 2023, there have been 12 certified conversion workshops that have been verified and listed on the Digital Platform as partners of the electric motor conversion program.

Gigih Udi Utomo said the training and workshop of converting oil-fueled motorcycles into electric motors had so far been carried out in 20 cities with a total of 425 participants in training and workshops. The next training will be held in 8 cities with an estimated 190 participants.

2. Incentives of IDR 7 Million per Motor Unit

The Ministry of Energy and Mineral Resources provides incentives of IDR 7 million per converted motorbike which will take effect from March 2023.

The Ministry of Energy and Mineral Resources has also imposed a number of criteria for vehicles that are suitable for conversion, including motorcycles that must be in prime condition and fit for roads, motorbikes with engine capacities or cubic centimeters (CC) 110 to 150 CC.

Vehicles must also be equipped with complete administration ranging from STNK, BPKB, legal vehicle number, to KTP. Then conversion must be carried out in a workshop that has a certificate from the Government and only applies to one vehicle per person.

Based on VOI records, since its enactment in March 2023, in May 2023 the Ministry of Energy and Mineral Resources recorded 193 two-wheeled vehicles that had registered for the conversion program.

Meanwhile, on July 27, 2023, ESDM recorded an increase in conversion applications to 4,578. This number is still far from the target set for 2023, which is 50,000 converted motorcycles.

Then on August 16, 2023, there were only 112 motorbikes whose conversion applications were successfully followed up and could get an incentive of IDR 7 million. This number is relatively small when compared to the incoming application of 5,399.

Special Staff to the Minister of Energy and Mineral Resources for the Acceleration of Industrial Development in the ESDM sector, Agus Tjahajana Wirakusumah, said that many applications were canceled because the costs borne were still high.

3. Socialization of the Conversion Program to 10 Big Cities

In order to increase public interest in converting fuel motors to electric motorbikes, the Ministry of Energy and Mineral Resources held a Roadshow for the Conversion of Electric Motors to 10 cities which began in Bali Province last July. Following Bali, the Ministry of Energy and Mineral Resources also held socialization in Surabaya and will continue to the cities of Yogyakarta, Semarang, Bandung, Medan, Balikpapan, Makassar, Mataram and Kupang.

The Director of Conservation of the Ministry of Energy and Mineral Resources, Gigih Udi Atmo, said that the low interest in public participation related to the conversion of electric motors was partly due to the lack of socialization, high prices, and public concerns regarding the electric motor component.

Gigih said that the socialization factor to the community is the most important thing to disseminate information about the benefits and conversion programs of electric motorcycles. Therefore, the socialization of the conversion of electric motorcycles will still be continued in several other cities in Indonesia.

In this socialization activity, the Ministry of Energy and Mineral Resources displays motors resulting from conversions, workshops and vocational schools that are partners and provides opportunities for the public to be able to test the conversion motorbike during the activity.

4. Invite Ministries/Institutions to Use Motorcycles to Convert as Operational Vehicles

Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif confirmed that he would widen the reach of converting motorbike recipients to no longer individuals but would begin to spread to agencies.

For this reason, he said, his ministry began to approach state-owned enterprises (BUMN) and private companies.

"Now we are trying to dor-to-door electric motor conversion to BUMN-BUMN, to offices," Arifin told the media, Friday, October 20.

Through this effort, he admitted that he had received positive responses from a number of private companies that would convert electric motorcycles.

Secretary General of the Ministry of Energy and Mineral Resources Dadan Kusdiana said that currently his ministry is making revisions to the Ministerial Regulation that has been signed previously.

"Now we are revising the Permen. Now it is limited to individuals even though there are many motorbikes owned by agencies and companies. This is what we will open," said Dadan.

Currently, 21 Ministries/Institutions, 23 Regional Governments and 2 government-owned educational institutions (PTN) are willing to participate in converting fuel motorcycles with BMN status into electric motorcycles.

5. Add Incentives From IDR 7 Million To IDR 10 Million

The Ministry of Energy and Mineral Resources (ESDM) has increased the amount of incentives for converting electric motors to IDR 10 million per unit.

Minister of Energy and Mineral Resources Arifin Tasrif said this policy had been implemented and was expected to boost people's wishes in the conversion program of electric motorcycles.

This plan was welcomed by the Indonesian Electric Motorcycle Industry Association (Aismoli).

They hope that the Ministry of Energy and Mineral Resources (ESDM) will immediately complete the revision of the rules related to incentives for converting fuel motorcycles into electric motorcycles.