Macroeconomic Drivers and the Forecast of Renewable Energy Consumption in Indonesia Toward Achieving SDG 7
Abstract
This study aims to analyze the macroeconomic factors that influence renewable energy consumption (REC) in Indonesia using the Autoregressive Distributed Lag model, and to forecast its future trajectory through 2030 under a business-as-usual scenario, with reference to the targets of SDG 7. Using annual data from 2000 to 2023, the study identifies four macroeconomic determinants: population, economic growth, non-renewable energy consumption (NREC), and technological innovation.In the short-run, REC is significantly influenced by its own past values, population, economic growth, and technological innovation, while NREC demonstrates a delayed but positive effect.In the long-run, population has a negative impact on REC, reflecting Indonesia's continued dependence on fossil energy sources.In contrast, economic growth, NREC, and technological innovation contribute positively and significantly, suggesting a gradual but constrained transition toward clean energy.The forecasting results indicate that REC in Indonesia may reach approximately 17.4% by 2030, still falling short of the 23% national target set for 2025, leaving a persistent gap of about 5.6 percentage points.These findings underscore the urgent need for stronger policy reform and increased investment in green technology and infrastructure, particularly to close the 5.6% REC gap.
Fields of Study & Subjects
Energy
Environment
Economic Growth
Renewable energy and sustainable power systems
Energy and Environmental Sustainability
Publication details
- Journal / source
- International Journal of Sustainable Development and Planning
- Volume
- 21
- Issue
- 1
- Pages
- 175–185
- Publication date
- 31 January 2026
- Language
- EN