A Benefit-Loss Analysis of Electricity Generation in Indonesia: Life Cycle Assessment and Economic Input-Output Analysis Application

Abstract

This paper presents a benefit-loss analysis of Indonesia's electricity generation from 2014 to 2018. The loss and benefits are expressed as Disability-Adjusted Life Years (DALY) per capita. In this paper, the benefit is the contribution of value-added triggered by electricity demand to GDP per capita. The value-added is calculated using the economic input-output model. The relationship between GDP per capita with DALY per capita is derived to estimate the reduction in the value of DALY per capita. The loss is the health damage of pollutants produced by electricity generation and is calculated using Life Cycle Assessment. The rise in DALY caused by the pollutants is quantified using Eco-Indicator 99. The results show that the average benefit-loss ratio is 1.257. In Indonesia, the average rate of change of the benefit with respect to electricity consumption per capita is lower than the rate of change of the loss. The analysis also shows a positive relationship between the rate of change of the benefit with the rate of change of electricity price. Promoting renewable energy and improving efficiency are ways to increase the benefit-loss ratio. The results also suggest that increasing the price is a lucrative alternative to increasing the benefit-loss ratio.