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The multi-level perspective analysis: Indonesia geothermal energy

transition study
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The 4th International Seminar on Sustainable Urban Development IOP Publishing
IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

The multi-level perspective analysis: Indonesia geothermal

energy transition study

A Wisaksono1*, J Murphy2, J H Sharp1, P L Younger1

1
School of Engineering, University of Glasgow, Glasgow, UK
2
School of Interdisciplinary Studies, University of Glasgow, Dumfries, UK

*Corresponding author: a.wisaksono.1@research.gla.ac.uk

Abstract. The study adopts a multi-level perspective in technology transition to analyse how
the transition process in the development of geothermal energy in Indonesia is able to compete
against the incumbent fossil-fuelled energy sources. Three levels of multi-level perspective are
socio-technical landscape (ST-landscape), socio-technical regime (ST-regime) and niche
innovations in Indonesia geothermal development. The identification, mapping and analysis of
the dynamic relationship between each level are the important pillars of the multi-level
perspective framework. The analysis considers the set of rules, actors and controversies that
may arise in the technological transition process. The identified geothermal resource risks are
the basis of the emerging geothermal technological innovations in Indonesian geothermal. The
analysis of this study reveals the transition pathway, which yields a forecast for the Indonesian
geothermal technology transition in the form of scenarios and probable impacts.
Keywords: geothermal, multi-level perspective, renewable energy, transitions

1. Introduction
Energy sustainability requires innovation, planning and development to be conducted carefully in
order to ensure energy sustainability. Hence, this paper suggests using the socio-technical multi-level
perspective approach, which is the main theory of the socio-technical transition [1], to study the ways
in which geothermal energy might replace mainstream energy in electricity generation. The levels are
socio-technical landscape (ST-landscape), socio-technical regime (ST-regimes) and niche innovations
[2], [3], [1]. ST-landscape includes prices, economic growth, conflicts, political status, environmental
issues, etc. There are exogenous factors that exhibit high degrees of proximity and power across
incumbent socio-technical systems [2]. The ST-regime is the set of rules or regulation that govern the
activities within the broad communities [3]. Niche innovations represent radical innovations, which
represents fundamental change that often depends on the integration of many interdependent systems
to succeed [3], [1].

2. Research Method
As developed by [1], the multi-level perspective is a non-linear process and evolutionary framework in
the process of technological transition [3]. This involves interactions between three levels across
which society and technology co-evolve. The technique is also being used in other case studies, for
example in car technology transitions, climate change responses, energy transitions, etc. [4], [5], [6]
[7], [8]. There are many external factors included in a multi-level perspective framework, which are
heterogeneous and related to the transition technology process. These factors fall within the
ST-landscape at the highest level within a multi-level perspective framework. These are then followed

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The 4th International Seminar on Sustainable Urban Development IOP Publishing
IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

by ST-regime while niches are at the lowest level of the perspective. In multi-perspective analysis, the
success of a new technology is not only influenced by processes in niche innovation, but also by
movements of, or changes in, the level of ST-regime and ST-landscape. However, in theory, resistance
to change will be primarily at the ST-landscape level, since ST-landscape factors are less likely to
change [3]. Any change within the ST-landscape may put pressure on the ST-regime and to open a
new path for new innovations to enter and influence both ST-regime and ST-landscape. The basis of
the niche innovation in geothermal exploration is to deal with resource risk that may arise during the
process. Innovations in geothermal drilling and exploration attempt to mitigate this [9]. Some self-
reinforcing innovations may initially require some degree of protection from external pressures
(a protected environment: e.g. research universities, government research institutions, etc.). From here,
niche actors can then nurture the path-breaking innovation so it becomes more robust through
performance improvements and expansions in supportive socio-technical networks [10]. Examples of
protected space are research institutions and research universities. In the past, society created
technology to help itself, but some argue that technology has become so powerful that it has been able
to “lock-in” societal activities [11], [12].
Path dependency is the way in which critical junctures at an early stage in the development of a
socio-technical system persist through self-reinforcing means [13]. In multi-level perspectives, path
dependency and technological lock-in are important in ST-regime level [15], [16], [17].
Controversy may be regarded as one of the side effects of technology transitions, especially if the
transition implies societal change. Technological systems are dynamic and unstable, and any change in
the components in the system (e.g. new entrant or a change in the institutional setup) may trigger
actions and reactions within the system [7] at the ST-landscape development level.

3. Results and Discussion

3.1. ST-regime analysis
Published laws from 2007 and 2009 make it clear that renewable sources expected to be the main
sources of energy in the future. However, the law of 2009 can be regarded as self-contradictory since it
also requires optimisation of primary energy both local (preferred) and imported. The wording of the
law indicates priority be given to primary resources such as coal, oil and gas.
88.32%

87.65%

87.87%
87.64%
86.31%
85.60%

10.90%

10.38%

9.81%

9.58%
9.48%

8.84%
3.50%

3.31%

2.88%

2.84%

2.54%

2.55%

2009 2010 2011 2012 2013 2014

Incumbent Other renewables Geothermal
Figure 1. Indonesia geothermal installed capacity power plant distribution versus other
resources.

Meanwhile, Figure 1 demonstrates this, where the planned use of fossil fuel as incumbent fossil energy
still increases in comparison to renewables. Table 1 explains the currently applicable regulation and
policies. The regulation basis pertaining to energy and electrification in Indonesia are [14] and [15] for
electrification, followed by [16] and [17]. Indonesian Laws are the highest in the hierarchy and
verified by the house of representative. Further examination of government regulations explains this
anomaly. In table 1, regulations from the year 2012 show that economic values is the factor that the
most difficult to change within ST-regime. Article [14] also underlined that renewable energy
development depends on the economic value.

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The 4th International Seminar on Sustainable Urban Development IOP Publishing
IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

Table 1. Meanings of current applied national energy and electrification regulation and policy
pertaining to source of energy.
Law no. 30 year 2007 pertaining to energy Law no. 30 year 2009 pertaining to electrification
Chapter 5, energy management. Chapter 5, the primary energy utilisation.
In article 20 (Energy supply), sentence no: In article 6, sentences no:
(2) Renewable energy are preferred for energy development (1) The utilization of primary energy, which are taken from local
(4) Government must increase the use of renewables resources and imported, must be optimised.
(5) Renewable energy suppliers will get convenience and (2) Renewable energy are preferred for energy utilisation.
incentives by the government, until it meets the economic value (3) Refer to sentence no. 1, local resources are preferred.

In article 21 Energy utilization, sentence no:

(2) Re-phrase article 20 sentence 4
(3) Re-phrase article 20 sentence 5, for energy utilization

Government regulation No. 14 year 2012 pertaining to

Government regulation No. 79 year 2014 pertaining to energy mix
electricity
Chapter 5, electricity pricing-network-tariff. Chapter 2, goals and target. On article 9, sentence (f) for energy mix:
The articles in the chapter, explains the mechanism of pricing, 1. Year 2030 Renewables increased 8% from year 2025.
network and tariff (economic value), which are determined by 2. Year 2030 oil decreased 5% from year 2025.
the decision and mutual agreement between the related 3. Year 2030 coal decreased 5% from year 2025.
governmental parties. Includes the minister, governor, 4. Year 2030 natural gas increased 2% from year 2025.
mayor/residents, and house of representative.
Chapter 3, national energy policy. On article 10, are mention the
increasing exploration of the potential or proven reserves of fossil energy
and renewables, decrease gas and coal export, to be used domestically,
and make sure the environmental capacity support for renewables.

Chapter 3, national energy policy. On article 11, are mention the

maximisation of renewables, in regard to economic value; minimisation
of oil, optimisation of renewables and natural gas; determination of coal,
as energy national supply.

That is why in [17], the government keen on energy mix policy, in which fossil fuels are still the
main energy, and even coal being determined as the national energy supply. It shows the argument by
Arthur, when usual policy of letting the superior technology reveal itself in the outcome that
dominates, is proven [11]. The actors involved in this case study are shown in Figure 2. Central to the
system are energy providers, the Indonesian national electricity company and consumers. Energy
providers include multi-national companies, private local companies and the government-owned
geothermal company. The other groups, which are government organizations, non-governmental
organizations, environmental activist groups, and the media, also attempt to influence the system. The
co-evolvement of society and technology demonstrated here at the ST-regime level.

Figure 2. Identified actors in the socio

technical regime of geothermal energy in
Indonesia.

3.2. ST-landscape developments

Developments in the ST-landscape could affect and pressurize the socio-technical ST-regime;
however, the impact and pressure from the ST-landscape is independent from (i.e. not influenced by)
the ST-regime. The Indonesian primary national energy supply remains dominated by fossil fuels. The
high levels of fossil energy supply reflects high demand for oil and gas products such as diesel for
electricity and industry. In these cases, the fuel is a form of final energy that is relatively easy to use
and reaches broad categories of consumer. Indonesia has one of the lowest electrification rates in Asia,

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The 4th International Seminar on Sustainable Urban Development IOP Publishing
IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

where frequent rolling power blackouts are experienced in Sumatra, Kalimantan, Java (excepting the
Jakarta rural area) and eastern part of Indonesia. Optimised use of geothermal energy could readily
increase the electrification ratio (see Figure 3), especially in the eastern part of Indonesia. This is the
main objective of government plans to increase the installed capacity of the energy mix. The problem
of the demand for electrification directly pressurises the ST-regime.
200%
88.30% 90.15% 92.75% 95.15% 97.35%
Percentage

100% 67.15% 72.95% 76.56% 80.51% 84.35%

0%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Year

Figure 3. Electrification ratio (2010-2015 = actual and 2016-2019 = goals).

Regulatin [25] permits geothermal exploration inside the protected forest and conservation area
(mostly located near volcanic areas) [18], which allows geothermal exploration in conservation areas.
However, controversies relating to geothermal development have arisen from cultural reasons and
constraints, even though the law protects these projects. Despite the problem of increasing electricity
demand, government policy to overcome energy deprivation is not always supported by a consensus
from the broader cultural society. As evidenced by the examples above and argued by [8], public
acceptance is needed if the aim to socially embed new technology is to be achieved. The existing
policies and regulations were not publicly accepted within this Indonesian cultural context.

3.3. Technological niches

The identified geothermal resource risks are the basis of the emerging geothermal technological
innovations in Indonesian geothermal development such as Enhanced Geothermal Systems (EGS),
subsurface analysis and cross-field innovations. EGS is a technology that is able to perform
geothermal exploration in areas that have technically and economically less potential, according to
conventional geothermal systems by enhanced drilling techniques and reconditioning of the reservoir.
There are very few activities evident in terms of EGS in Indonesia now, principally due to fewer hot
dry rock resources and too many unexplored hydrothermal systems. EGS yet to be implemented in
Indonesia since geothermal systems in Indonesia are generally convective hydrothermal [19] and the
majority of the resources are not hot dry rock with low levels of water or vapour. Subsurface data
modelling would be extremely useful to model the reservoir conditions during exploration. It would
enable more efficient reservoir maintenance and management and serve as important data with regard
to planning further developments, e.g. drilling new boreholes. According to Younger, reservoir
modelling and management approaches need to be widely developed as common innovations in the
geothermal industry [20]. Indonesian researchers have developed their own research studies in
geothermal modelling fields as presented at a recent geothermal conference at Stanford University in
early 2017 [21] [22]. This shows strong evidence that niche innovation in subsurface modelling is
growing in Indonesia. Meanwhile, the most relevant potential cross-field technology is at the
electricity production level, specifically hybrid power plants. There is only one new hybrid power
plant in Indonesia (Yogyakarta area), which does not involved geothermal, and instead uses a
combination of solar PV and wind turbines.

3.4. Discussion: Transition forecast

Based on the multi-perspective theory and analysis from the previous sections, the socio-technical
pathway would be the transformation pathway, with incremental change [1]. In Figure 4, electricity
demands and the environmental issue both create resistance in the ST-regime’s path-dependence,
which also supports the indication for a longer time for the transition. Based on the empirical data,
ST-regime analysis and ST-landscape developments at the transition pathway:
a. ST-landscape development pressure from electrification demands, however environmental issues
reduce this pressure. The Indonesian government plans to build a geothermal power plant totalling
7200 MW in order to increase the electrification ratio from 88.30%. Due to high demand, growth of

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The 4th International Seminar on Sustainable Urban Development IOP Publishing
IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

renewables has previously been neglected in order to build and explore quick, cheap and powerful
coal powered energy resources [23].

Figure 4. Geothermal energy transformation pathway, Figure 5. Four possible scenarios, with
with incremental change. their transition seeds

b. Financially strong incumbent ST-regime. Funding and investment constraints has allowed the
increase in the use of cheap and efficient fossil fuel energy sources, namely natural gas and coal,
supported by numerous local reserves.
c. Policy change influence at ST-regime. Energy mix government regulation [17], creates both lock-
in to fossil energy, but opens a path to incremental change with a very small number of niches in
renewable and geothermal. The government power resources plan consists 23% renewables in 2025
[24].
d. Few niche innovations. Excitement for environmental friendly energy (e.g. solar, wind, hydro,
geothermal) aligned with laws and government regulations will open the door for investment in
renewables. With support from specific government regulation relating to geothermal sources [25],
[26].
Based on the transition seeds, the potential scenarios for the next 20 years are:
S1. Geothermal energy with installed capacity of 5% of the total energy mix policy. Incumbent
energy resources still leading, while geothermal energy development is stagnant. The instant
solution to increase the electrification ratio is to push the usage of the local natural resources.
This scenario is aligned with the current government decision to develop and commence several
coal powered steam power plants in Indonesia between 2015 and 2019 [27], [28].
S2. Geothermal energy with installed capacity of 10% of the total energy mix policy. S2 occurs,
when S1 fails to meet the target. Geothermal energy and other renewables still take a long time to
grow in Indonesia. S2 only starts after S1 ends. The current local reserves of natural gas are
extensive. Natural gas now leads the energy source.
S3. Geothermal energy with installed capacity of 20% of the total energy mix policy. Government
gives more investment and support in renewables research to comply with the law and the
government’s recent plan [23]. The latest policy to support this scenario is government support in
geothermal project funding by injection of project capital, allowing geothermal developers to
seek financial support from state owned financing company [29].
S4. Geothermal energy with installed capacity of 5% of the total energy mix policy. Nuclear power
plants alone also could raise the electrification ratio to 100% in combination with existing fossil
and renewables. Controversies within the ST-regime will become constraints in this development.
However, due to urgency, it becomes reality [30].

4. Conclusion
Based on the theory of the multi-level perspective framework as applied to technology transitions,
conflicts were seen to be part of the ST-landscape development. Conflicts can act to trigger change in
the ST-landscape, which may then put pressure on the ST-regime. However, conflicts within the
ST-regime will only make the incumbent ST-regime path dependency stronger. Further study is
needed to analyse this finding. The ST-landscape development on the other hand, helps to identify the
potential changes in the level, which, in this case, are the demands for electricity. Based on the data,

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IOP Conf. Series: Earth and Environmental Science1234567890
106 (2017) 012114 doi:10.1088/1755-1315/106/1/012114

we conclude that these demands are due to electricity deprivation in large parts of Indonesia.
According to the latest popular niche innovation in the global geothermal industry, the study points to
multiple evidences of innovation in Indonesia. Unfortunately, at the current time, it still unable to
influence the incumbent ST-regime. Overall, the framework smoothly connects the ST-regime with
ST-landscape and niche innovations. The pathway analysis was able to help the study examine several
scenarios, which forecast the outcome of technological transition in geothermal development in
Indonesia.

Acknowledgment
The authors would like to gratefully acknowledge that this work has been made possible by financial
support from the Indonesia Endowment Fund for Education (LPDP), Republic of Indonesia.

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