Projected 2025 LPG consumption rises, imports reach more than 70%

Jakarta – National LPG consumption is projected to continue to rise, with imports also expected to reach more than 70 per cent of total demand. This trend raises concerns about the growing annual subsidy burden and Indonesia’s dependence on foreign energy supplies.

Director of Infrastructure Planning and Development at the Ministry of Energy and Mineral Resources, Laode Sulaeman, revealed that national LPG consumption in 2023 reached 8.05 million metric tons (MT) and is projected to decrease slightly to 8.03 million MT in 2024. However, in 2025, consumption is predicted to increase to 8.17 million MT.

“This increase in consumption will increase the annual LPG subsidy burden and require us to import more LPG,” Laode said in his statement, on Thursday, August 8. Facing this situation, Laode emphasised the importance of efforts to control LPG consumption, especially through the transfer of LPG use to the gas network (jargas).

“The use of gas through jargas is proven to reduce the consumption of subsidized LPG and also control the burden of LPG imports,” he said.

The Ministry of Energy and Mineral Resources cooperates with the Ministry of Home Affairs to support policies for jargas development in various regions, as well as with the Ministry of Public Works and Public Housing (PUPR) to integrate jargas development with housing projects. In addition, coordination is also carried out with the Ministry of Finance and the Ministry of SOEs regarding the jargas subsidy mechanism.

PT Perusahaan Gas Negara Tbk (PGN) as Pertamina’s Gas Subholding, has an important role in the development of jargas. Currently, PGN manages 820,614 house connections (SR) spread across 18 provinces and 74 regencies/cities, whose contribution is equivalent to a reduction in LPG subsidies of Rp 1.7 trillion.

PGN’s Commercial Director, Ratih Esti Prihatini, stated that the development of jargas is PGN’s long-term strategic project that will be carried out sustainably.

“This year, PGN is targeting 117 thousand SRs, and we are optimistic that this target can be achieved with the support of various initiatives and strategic partners,” she explained.

However, the development of jargas is not without challenges. PGN faces issues of economics, construction, customer interest, and increased usage. Ratih emphasised that PGN must be able to answer these challenges and align efforts to increase natural gas utilisation with its responsibilities as a business entity.

“PGN wants the development of jargas to benefit the community while supporting the sustainability of the company’s business. We believe that the massive development of jargas will have an impact on the growth of our core business,” she added.

Ratih added that jargas development not only provides added value to the community but also has a positive impact on the company in the long run. With the right approach, risk and business sustainability are maintained. (Hartatik)

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