JAKARTA: The development of renewable energy requires government support, including provision of incentives.In fact, the development of renewable energy is difficult to realize as long as there is a fuel subsidy.President Director of PT Pertamina (Persero) Karen Agustiawan said alternative energy development requires big investment in the beginning, thus it needs full support from the government."The cost of renewable energy development is still expensive compared to fossil energy. Moreover, Indonesia is still giving fuel subsidy, so renewable energy price is less economical," she said after panel discussion in World Economic Forum, yesterday. In the forum, Karen was acting as Co-Chair of WEF East Asia for Energy.Besides the issue of incentives, as she an added, other constraint in developing renewable energy industry is the absence of support from banks. "Financial industry does not fully understand the need for capital incentive in the business."Karen saw renewable energy can be developed in Indonesia and Asian Countries, if the price is competitive with fuel price.The energy development, as she said, depends on the percentage of required capital return. From the percentage, we could be determined the need of fiscal incentives, taxes, or soft loan facility.The weakness of renewable energy development industry is actually not only happen in Indonesia but also in the world.Bloomberg New Energy Finance recently reported that new Investment in renewable energy during first quarter in this year fell to US$31.1 billion, compared US$47.1 billion in the same period last year.The decline was caused by the decrease of natural gas price and European countries policy which decided to cut the fund for the renewable energy development.Indonesian government in Presidential Decree No 5 / 2006 on energy policy has set a target of renewable energy share market at the level of 17% in 2025.Now, there is also a plan to achieve higher target on national energy mix which is 25% in 2025, otherwise it is known as Energy Vision 25/25.According to Managing Director of Pertamina, investors in the sector have not yet required a maximum return. Investors, as he said, merely require adequate return."Renewable energy has been more advanced in Thailand. The country gives decent tax incentives. Indonesia still needs further talks on how to develop this energy."To be continuedRelated with the energy development, Chairman and Chief Executive Officer of GDF SUEZ Gerard Mestrallet saw Asian Countries are tend to continue the development of nuclear power plant after Fukushima tragedy in Japan, in a hope that nuclear can be a future energy as the dwindling of fossil resources.According to him, nuclear is a solution in anywhere in this world and it is a political choice for every country. Interestingly, there are different reactions between some countries in Asia, Europe and US related with the development of nuclear reactor after the Fukushima tragedy."Many Asian nations decided to stay with nuclear. It is dramatic since they want to continue their nuclear projects," he said.In contrast, as Mestrallet said, Western European countries such as Germany, Swiss and Italy decided to stop the development of nuclear project"Even more, Italy wants to hold a referendum related to the use of nuclear. Europe is still full of doubt whether to stop or continue the nuclear projects. In United States, some operators also decided to stop the project. "(t03/msw)

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