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Using the Climate Auction Model to Promote Energy-Efficient Buildings in Indonesia (Английский)

This report presents a summary of the main results of the analysis. It includes the following sections: section one introduces the main scope and objectives, and methodology of the study. Section two provides an overview of the regulatory context for the housing sector in Indonesia, including current policy and regulatory frameworks at the national and sub-national levels in Indonesia that are relevant to energy efficiency, green buildings, and the housing market, especially its low-income segment, which is the focus of the overall study. Section three discusses the institutional setup and key stakeholders involved in the low-income housing and green building segments in Indonesia. Section four provides an overview of two voluntary green building certification schemes in Indonesia, namely GREENSHIP and EDGE, and examines their suitability for the climate auction pilot. Section five presents the current status of the LIH market in Indonesia. Section six examines the four geographies suitable for a pilot phase of the climate auction mechanism. Section seven provides an analysis of key market players involved in the LIH segment in Indonesia and their suitability as well as potential interest in participating in the climate auction. This section also discusses the existing opportunities and challenges for the potential bidders. Section eight reviews the base case values in the EDGE tool for LIH units in Indonesia to determine whether they represent the business-as-usual (BAU) scenario, and provides recommendations for their revision, where necessary, to ensure that incentives to be provided through the climate auction will increase the energy and resource efficiency of typical low-income housing. Section nine presents the results of the financial analysis for estimating the required incentives that are deemed necessary to enable the incremental investment needed to improve the housing unit’s energy performance and bring it up to the desired level. Section ten provides an overview of available access to financing and incentives for LIH developers. Section eleven summarizes the key findings of the study and provides a set of recommendations for the climate auction pilot design.

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