Renewable and Sustainable Energy Reviews 16 (2012) 35473558

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Renewable and Sustainable Energy Reviews

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Letter to the Editor

Cost benet analysis and environmental impact of fuel economy standards for passenger cars in Indonesia

a r t i c l e

i n f o

Keywords:
Indonesia
Passenger cars
Fuel economy standards
Fuel saving
Environmental impact
Cost benets

a b s t r a c t
In Indonesia, passenger cars are the second biggest fuel consumer in the transportation sector. Like many
other developing countries, Indonesia has experienced a dramatic increase in the number of passenger cars. The number of passenger cars has increased from 1,170,103 in 1987 to 9,859,926 in 2008 and
expected to reach 38,869,926 in the year 2030. This increase in the number of cars will have an impact
on fuel consumption and emission production. Therefore, fuel economy standards for passenger car have
been suggested as a proper solution to reduce fuel consumption and emissions such as CO2 , HC, NOx and
CO. The rst part of this paper presents an overview of the current fuel economy standards and test methods around the world besides ASEAN region to highlight the importance of this energy saving measure.
The second part of this study attempts to estimate the amount of fuel saving and emission reductions in
the Indonesian transportation sector by implementing fuel economy standards for passenger cars. The
calculations were made based on the government, manufacturer and ownership data of passenger cars.
The study found that fuel economy standards for passenger cars would save money, fuel and most importantly mitigate a signicant amount of emissions to protect the environment. It has been found that, a
total amount of 32 billion litres, IDR 190,640 billion (USD 19 billion), 1,457,918 ton CO2 , 32,587,345 kg
HC, 27,021,296 kg NOx and 69,122,843 kg CO could be saved between 2015 and 2023 due to implementation of fuel economy standards. As a conclusion, the author would like to emphasise the importance of
adopting this policy in a highly populated and developing country such as Indonesia which will help it
to save fuel and mitigate emissions.
2012 Elsevier Ltd. All rights reserved.

1. Introduction
In line with Indonesias recovery from the Asian nancial crisis
of 1998, energy consumption has grown rapidly in the recent years.
In Indonesia, the transportation sector is currently the third largest
energy consuming sector (28%) after the industrial sector (40%) and
residential sector (29%). Over the past two decades, transportation
energy consumption of Indonesia grew at an average annual rate
of 6.3%. Transport energy consumption was mostly driven by the
road sub-sector and accounted for about 87% of the incremental
growth. Gasoline consumption for passenger cars and motorcycles
and diesel for buses and trucks also increased drastically between
1971 and 2007 as shown in Figs. 1 and 2, respectively. It is expected
that the continued economic growth and development of the car
manufacturing industry will result in a substantial increase in the
number of passenger cars from 3.4 million units in 2002 to 13.9
million units in 2030 [14].
In 2000, the global transport sector was the largest source of
emissions of oxides of nitrogen (NOx ) (estimated to be 37% of the
total anthropogenic emissions of NOx ) and was also a major contributor of CO2 (21%), volatile organic carbon (VOC) (19%), CO (18%)
and black carbon (BC) (14%). All of these pollutants have a harmful impact on environment and health. In developing countries,
rapid urbanization and economic growth have spurred air pollution particularly in road transport sector due to the rapid vehicle

1364-0321/$ see front matter 2012 Elsevier Ltd. All rights reserved.
doi:10.1016/j.rser.2012.01.001

growth and increasing demand of petroleum based fuels [58].

In Indonesia, it is believed that the motorized cars are the major
source of air pollution in the big cities especially in Jakarta and are
responsible for approximately 70% of the total emissions causing
air pollution in the agglomeration. The rise in energy demand from
road transport is expected to worsen the air quality in major cities.
Main causes of air pollution are rapid motorization, inappropriate
trafc management, low fuel prices, outdated car technology, poor
engine maintenance, inadequate public transport systems and poor
urban planning [9].
Car ownership in Indonesia is dominated by motorcycles as can
be seen in Fig. 3 [10]. The percentage of cars in Indonesia in 2008 is
illustrated in Fig. 4 [10].
Indonesian government began implementation some measures
to prevent air and noise pollution for new cars. Government regulations mandate that new cars sold in Indonesia must comply with
the Euro 2 standard started in January 2005. However, this regulation became effective in January 2007 with the phase out of leaded
gasoline. The output from the testing program is emissions and
performance information [1,11,12].
While a total car kilometer travelled by motorcycle is a small
fraction of total car kilometers travelled in the United States and
Europe. This study attempts to calculate the economical and environmental impacts when implementing fuel economy standards
for passenger cars in Indonesia.

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Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

8000
6000
4000

10000
9000
8000
7000
6000
5000
4000
3000
2000
1000

2005

2007

2003

2001

1999

1997

1995

1993

1991

1987

1989

1985

1983

1981

1979

1977

1975

Fig. 2. Road sector diesel fuel consumption (kt of oil equivalent) in Indonesia [3].

70,000,000
60,000,000

Motor Cycles

50,000,000

Trucks

40,000,000

Buses
Passenger Car

30,000,000
20,000,000
10,000,000

Passenger Car
15.11%

2. Literature review
Trucks 7.88%
Motor Cycles
73.05%

Fig. 4. Percentage of car in 2008 [10].

2008

2006

Fig. 3. Number of cars in Indonesia [10].

2007

2005

2004

2003

2001

2002

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

1990

1989

Buses 3.96%

There are many fuel-saving approaches to improve car fuel

economy. Fuel economy standards are one of the best strategies to reduce energy utilization and help any country to reduce
their pollution [1315]. Generally, standards are mandatory programs (regulations) stipulating the minimum efciency levels or

2005

Fig. 1. Road sector gasoline fuel consumption (kt of oil equivalent) in Indonesia [2].

Subscripts
i
in the year i
year of standards enacted
s

2.1. Introduction

2007

2001

2003

1999

1997

1993

1995

1991

1989

1987

1983

1985

1981

1979

1977

1973

1971

1975

2000

1988

Superscripts
p
passenger cars
k
number of emission

10000

1971

N vil
number of passenger cars in year i l
PFi
fuel price in year i (IDR/L)
p
PV (ANSi ) present value of net money savings in year i for
passenger cars
p
SFCs
standards fuel consumption of passenger cars
(L/year)
p
scaling factor of passenger cars in year i
SFi
p
Shi
shipments of passenger cars in year i
p
SSFi
shipment survival factor in year i for passenger cars
(%)
T
target year
total number of passenger car
Tn
p
TFSi
total fuel savings by the total stock of passenger cars
in year i (L/year)
p
total fuel efciency improvement (%)
TFSs
p
UFSi
initial unit fuel savings of passenger cars in year i
(L/year)
p
UFSs
initial unit fuel savings of passenger cars in enacted
year (L/year)
X
predicted year starting year
Y
predicted value
p
year i of standards enacted of passenger cars
YSEi
p
Yses
year of standards enacted of passenger cars
p
YSHi
year i of shipment of passenger cars

12000

1973

BSs
CRF
d
Emk
p
ERi
p
IICs
IDR
Lp
NSiP
p
N vi
p
N vi1

14000

1987

BFCs

annualized net savings in year i for passenger cars

(IDR)
baseline fuel consumption in the year of fuel economy standards enacted for passenger cars (L/year)
bill savings in year i for passenger cars (IDR)
capital recovery factor
interest rate per year (%)
emissions k for fuel type a unit litre (kg/L)
emission reduction in year i of passenger cars (kg)
initial incremental cost of passenger car (IDR)
Indonesian Rupiah
lifespan of passenger car
net savings in year i for passenger cars (IDR)
number of passenger cars in year i
number of passenger cars in year i 1

Road sector diesel fuel consumption (kt of oil

equivalent)

p
ANSi

annual fuel efciency improvement (%)

applicable stock of passenger cars in year i
applicable stock of passenger cars in year i 1

Numbers of motors vehicle by type

AFIi
p
ASi
p
ASi1

Road sector gasoline fuel consumption (kt of

oil equivalent)

16000

Nomenclature

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

3549

Table 1
Fuel economy and GHG standards for vehicles around the world [20,22,23].
Country/region

Type

Measure

Structure

Test method

Implementation

United States
European Union
Japan
China
California
Canada
Australia
Taiwan, South Korea

Fuel
CO2
Fuel
Fuel
GHG
Fuel
Fuel
Fuel

mpg
g/km
km/L
L/100-km
g/mile
L/100-km
L/100-km
km/L

Cars and light trucks

Overall light-duty eet
Weight-based
Weight-based
Car/LDT1 and LDT2a
Cars and light trucks
Overall light-duty eet
Engine size

U.S. CAFE
EU NEDC
Japan 1015
EU NEDC
U.S. CAFE
U.S. CAFE
EU NEDC
U.S. CAFE

Mandatory
Voluntary
Mandatory
Mandatory
Mandatory
Voluntary
Voluntary
Mandatory

LDT1 and LDT2 are categories of light-duty trucks.

maximum energy-use levels acceptable for products sold in a particular country or region. They are often called minimum efciency
standards or minimum energy performance standards (MEPS) [16].
In the transportation sector, fuel economy standards are procedures and regulations that prescribe a fuel economy level as criteria
that manufacturers must meet in order to get the permission to sell
their products in the market. Standards are generally designed to
improve energy efciency without degrading the products other
features such as performance, quality, safety and overall cost. Standards of an appropriate type and level of stringency may yield
synergistic results. In order to set fuel economy standards for vehicles, a regulatory authority must be developed [14,15,1719].
Globally, there are nine major regions around the world that
have implemented fuel economy and greenhouse gas (GHG) emission standards. These regions include; USA, European Union,
Canada, Japan, China, Taiwan, South Korea and Australia. Table 1
gives a summary of fuel economy and GHG standards for vehicles
in these countries. In 2004, a methodology to compare different
fuel economy standards and greenhouse gas emissions around the
world have been developed by An and Sauer. Their key ndings
were; Japan and Europe lead the world with the strictest regulations. Japanese standards are expected to lead to the lowest eet
average greenhouse gas emissions in the world (125 g CO2 /km by
2015). China is moving forward. However, U.S. automobile fuel
economy standards lag behind them but could move ahead of
Canada, Australia and South Korea by 2020. The summary of their
ndings is shown in Fig. 5. More complete details on these standards can be found in Refs. [2023].
2.2. Structures of fuel economy/GHG standards
The structures of fuel economy and GHG standards vary greatly
among countries/regions. Some of these measures are as follows
[22,23,26]:

Fleet average target:

EU (CO2 g/km)
Australia (L/100 km)
Divided by vehicle categories
US, Canada (mpg) Cars and LDTs, California (CO2 , g/mile)
(PC/LDT1, LDT2)
Based on vehicle/engine attributes:
Vehicle test weight bins
Japan (km/L) 9 weight classes
China (L/100-km) 16 weight classes
Based on engine size
South Korea (km/L)
Based on vehicle footprint
Newly adopted in US and EU standards

2.3. Fuel economy standards and test methods around the world
2.3.1. European Union
During 1990s, the European Union and the associations of
vehicle manufacturer association, Association des Constructeurs
Europens dAutomobiles (ACEA) set voluntary agreements to
reduce emissions of carbon dioxide (CO2 ) from vehicles. The year
1995 was taken as the base year and 25% reduction was proposed
to be achieved in 2008. In June 2007, the Council of Environment
Ministers formally adopted a resolution to make the 2012 targets mandatory. The EU target of 120 g CO2 /km (46 mpg) by 2012
would be met through an integrated approach between the EU
and the association of car manufacturers. In this approach, car
manufacturers would achieve 130 g/km (42 mpg) through technical
improvements in vehicle and engine and the remaining reduction of 10 g/km from other measures such as efcient tires and
air conditioners, improvements in light-commercial vehicles and
increased use of bio-fuels. By 2015 all new cars must meet this
standard. In Europe, the long-term goal for the eet average of
new cars is 95 g CO2 /km (or 58 mpg) by 2020 with a review in 2013
[20,23,2634]. Table 2 shows a summary of these targets between
1995 and 2020.

Table 2
Fleet averaged greenhouse gas, CO2 emission standards in Europe (g/km)
[20,23,30,31,35].
Year

New car eet average

1995
2003
2004
2008 (target)
2012 (target)
2020

185 (base value)

165 (achieved)
161
140
120b
95

12.6
14.1

16.6
19.4

FE in km/l of gasoline = 2325/CO2 g/km

130 g/km through vehicle technology and further 10g/km reduction via biofuels.
b

Fig. 5. Comparison of fuel economy standards mpg normalized by CAFE [20,24,25].

Approx. equivalent FEa

(km/l of gasoline)

3550

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

Table 3
Japanese fuel economy standards for passenger cars (km/l) [20,23,26].
Vehicle mass (kg)

Gasoline
cars (2010)

Diesel cars
(2005)

LPG (2010

702
703827
8281015
10161265
12661515
15161765
17662015
20162265
2266

21.2
18.8
17.9
16.0
13.0
10.5
8.9
7.8
6.4

18.9
18.9
18.9
16.2
13.2
11.9
10.8
9.8
8.7

15.9
14.1
13.5
12.0
9.8
7.9
6.7
5.9
4.8

2.3.2. Japan
In 1999, the Japanese fuel economy standards were established
for gasoline and diesel powered light-duty passenger and commercial vehicles. Standards are determined based on the performance
of the vehicles whose performance is the best based on the Top
Runner method. These standards are set based on weight class.
The regulations were revised again in 2001 to allow automakers
to accumulate credits in one weight class and use them in another
weight class. The summary of these standards are given in Table 3.
The targets for gasoline vehicles are to be met by 2010, while 2005
is the target year for diesel vehicles. In Japan, the majority of gasoline passenger vehicles sold in 2002 already met or exceeded the
2010 standards. Therefore, the fuel economy targets were revised
again in December 2006 upwards to be effective from the year 2015,
even before the gasoline vehicle FE standards were yet to be implemented from the year 2010. The number of weight categories was
increased from nine to sixteen. These new standards notied for
implementation from the model year 2015, are shown in Fig. 6. The
new standards are projected to improve the eet average fuel economy of new passenger vehicles from 13.6 km/l in 2004 to 16.8 km/l
in 2015 giving an improvement of 24% [20,23,2931,35,36].
2.3.3. USA
In 1975, the U.S. Congress passed the Energy Policy and
Conservation Act which established the Corporate Average Fuel
Economy program (CAFE). This program is administered by
National Highway Trafc Safety Administration (NHTSA). CAFE
requires automobile manufacturers to meet a standard for the
sales-weighted fuel economy of light duty passenger vehicles sold
in the United States [23,37]. The standards for light duty passenger
vehicles were set starting from model year (MY) 1978/80 and are
given in Table 4. Light duty passenger vehicles (LDVs) include both
passenger cars and light-duty trucks [23,30].

The standards for passenger cars remain unchanged since 1991

and stand at 27.5 mpg (11.7 km/l). The CAFE standards for light
trucks have been revised upwards from 20.7 mpg in 1991 to
24.0 mpg to be achieved by the model year 2011 starting from the
year 2007 [20,21,23,26,30,36,3841].
Pursuant to the recent Presidents announcement of a National
Fuel Efciency Policy, the National Highway Trafc Safety Administration (NHTSA) and the EPA have promulgated nationally
coordinated standards for tailpipe CO2 -equivalent emissions and
fuel economy for both passenger cars and light-duty trucks. In
the joint rulemaking, EPA is enacting CO2 -equivalent emissions
standards under the Clean Air Act (CAA), and NHTSA is enacting
companion CAFE standards under the Energy Policy and Conservation Act [23,42].
The standards will affect model year (MY) 2012 vehicles, and
compliance requirements will increase in stringency through MY
2016. NHTSA has estimated the impact of the new CAFE standards
and has projected that the proposed eet-wide standards for LDVs
will increase fuel economy from 29.7 mpg in MY 2012 to 34.1 mpg
in MY 2016 and 35 mpg in 2020, an average annual increase of
2.2%. EPA projects a eet-wide reduction in CO2 -equivalent emissions from 295 g/mile for MY 2012 to 250 g/mile for MY 2016
[23,37,42,43].
The fuel standards use an attribute-based methodology to
determine the minimum fuel economy requirements and CO2 equivalent emissions standards for vehicles based on footprint,
dened as the wheelbase (the distance from the center of the front
axle to the center of the rear axle) times the average track width
(the distance between the center lines of the tires) when the tires
are mounted on rims with zero offset and wheelbase is the longitudinal distance between front and rear wheel centerlines. All of
these distances are measured in square feet. In case of multiple rear
axles, wheelbase is measured to the midpoint of the centerlines of
the front wheels and wheels on the rearmost axle [23,30,36,39,42].
2.3.4. China
In 2009, China became the largest auto producer and market.
However, Chinas oil supply depends increasingly on import from
other countries [23,44]. Therefore, China has set a vehicle fuel economy goal of 35.8 mpg by 2009 [23,29]. Recently, China has approved
new regulations of fuel economy standards for its passenger vehicle eet to control the countrys rapidly growing vehicle market.
These standards are mainly intended to alleviate Chinas increasing
reliance on foreign oil, but another objective is to promote foreign
automakers to bring more fuel efcient vehicle technologies to the
Chinese market. The new standards will be implemented in two
phases: Phase 1 will take effect on July 1, 2005, for new vehicle

Fig. 6. The new Japanese vehicle fuel economy standards effective from the model year 2015 [21,23,30,31].

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

3551

Table 4
Historical U.S. corporate average fuel economy (CAFE) standards, mpg [23,30].
Model year

Passenger cars

Light trucks combined

Light trucks (2WD)

Light trucks (4WD)

1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991

18.0
19.0
20.0
22.0
24.0
26.0
27.0
27.5
26.0
26.0
26.0
26.5
27.5
27.5
Unrevised until 2008

17.2
14.0

17.5
19.0
20.0
20.5
20.5
20.0
20.5
20.5
20.0
20.2

17.2
16.0

18.0

20.3

20.5

21.0

20.5
20.7
Revised in 2005

15.8
14.0

16.0

18.5

19.5

19.5

19.0
19.1

Table 5
Maximum limits for fuel consumption (L/100-km) and minimum CAFE-equivalent mpg limits, for passenger vehicles in China (excluding Taiwan) [20,23,46].
Weight (lbs)

Maximum fuel consumption limits based on NEDEC cycle (L/100 km)

Phase 1 (2005)

1667
1922
2178
2422
2678
2933
3178
3422
3689
3933
4178
4444
4689
5066
5578
5578

Phase 2 (2008)

Minimum fuel economy limits based on U.S. CAFE-equivalent (mpg)

Phase 1 (2005)

Phase 2 (2008)

Manual

Auto/SUV

Manual

Auto/SUV

Manual

Auto/SUV

Manual

Auto/SUV

7.2
7.2
7.7
8.3
8.9
9.5
10.1
10.7
11.3
11.9
12.4
12.8
13.2
13.7
14.6
15.5

7.6
7.6
8.2
8.8
9.4
10.1
10.7
11.3
12.0
12.6
13.1
13.6
14.0
14.5
15.5
16.4

6.2
6.5
7.0
7.5
8.1
8.6
9.2
9.7
10.2
10.7
11.1
11.5
11.9
12.3
13.1
13.9

6.6
6.9
7.4
8.0
8.6
9.1
9.8
10.3
10.8
11.3
11.8
12.2
12.6
13.0
13.9
14.7

36.9
36.9
34.5
32.0
29.9
28.0
26.3
24.8
23.5
22.3
21.4
20.8
20.1
19.4
18.2
17.1

35.0
35.0
32.4
30.2
28.3
26.3
24.8
23.5
22.2
21.1
20.3
19.5
19.0
18.3
17.1
16.2

42.9
40.9
38.0
35.4
32.8
30.9
28.9
27.4
26.1
24.8
23.9
23.1
22.3
21.6
20.3
19.1

40.3
38.5
25.9
33.2
30.9
29.2
27.1
25.8
24.6
23.5
22.5
21.8
21.1
20.4
19.1
18.1

models, and on July 1, 2006, for continued vehicle models. Phase 2

will take effect on January 1, 2008, for new models and on January
1, 2009, for continued vehicle models. One distinctive feature of
the Chinese standards is that they set up maximum allowable fuel
consumption limits by weight category rather than being based
on eet average. Each vehicle sold in China will be required to
meet the standard for its weight class. The standards will be classied into 16 weight classes, ranging from vehicles weighing less
than 750 kg (approximately 1500 lbs) to vehicles weighing more
than 2500 kg (approximately 5500 lbs). Table 5 shows maximum
limits for fuel consumption (L/100 km) and minimum CAFE equivalent mpg limits for passenger vehicles in China (excluding Taiwan)
[20,21,23,4447].
In December 2009, Chinese Ministry of Industry and Information
Technology (MIIT) issued its proposed Phase 3 fuel consumption
regulation for passenger cars, aimed at reducing the fuel consumption of new passenger vehicles to 7 L/100 km (167 g CO2 /km)
by 2015. The China Automotive Technology and Research Center (CATARC) are now developing a detailed implementation and
enforcement plan because of the shift from a per-vehicle standard
to a corporate average standard [23,35,44].
2.3.5. South Korea
In March 2004, South Korea announced that it will implement
mandatory fuel economy standards for the rst time to replace
the voluntary system. Vehicles will be evaluated for compliance
with the AFE standard using the U.S. EPA City test cycle. The
new AFE regulation is in part a response to declining average fuel

Table 6
South Koreas new average fuel economy standards for light-duty vehicles [20].
Vehicle engine size (by cylinder
volume/displacement) cm3

km/L

mpg CAFE

1500
>1500

14.4
9.6

39.9
26.6

economy, largely due to an increase in the sales of SUVs (sport

utility vehicles). The new standards will be enacted in 2006 for
domestic cars and in 2009 for imported cars with sales less than
10,000 vehicles. However, companies manufacturing or importing
more than 10,000 vehicles per year will be subject to U.S. CAFE standards per South Korean law [20,21,36]. Table 6 shows South Koreas
new Average Fuel Economy Standards for light-duty vehicles.
2.3.6. Fuel economy standards and labels in the ASEAN region
The development of fuel economy standards can be summarized
as the perceptions of fuel consumption and awareness to mitigate
emission in ASEAN countries. Many ASEAN governments take the
initiative to enhance global efforts to combat climate change and
air pollution in the transportation sector by encouraging switching
from fossil fuels to natural gas and promote the use of bio-fuels. Furthermore, Wills and Rovere [48] reported that the implementation
of vehicle energy efciency program with technological improvements in motor vehicles, fuel efciency and the establishment of
more rigorous fuel economy or emissions limits will all help to
reduce GHG emissions.

3552

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

Table 7
Overview of National Ministries/Departments leading vehicle and fuel related policies development in ASEAN [49,50].
ASEAN countries

Vehicle emissions
standards

Fuel quality

Vehicle tariffs/taxes and

fuel subsidies/taxes

Energy efciency and

possibly fuel economy

Indonesia
Malaysia
Philippines
Singapore
Thailand
Vietnam

Environment
Environment
Environment
Environment
Environment
Transport

Energy
Energy
Energy
Environment
Energy
Environment

Finance
Finance
Finance
Finance
Finance
Finance

Energy
Energy
Energy
Environment
Energy
Transport

Table 7 provides an overview of the various government agencies involved in the development and setting of standards on
vehicle emission standards and fuel quality in different ASEAN
member countries. Table 8 provides an overview of the various
government agencies involved in the development and setting of
standards on vehicle emissions standards and fuel quality in different ASEAN member countries.
2.3.6.1. Malaysia. In Malaysia, the transportation infrastructure
and air quality is fairly good and its relatively high economic status has encouraged private motorized transportation in most cities
in Malaysia. Malaysia has substantial rail and public transportation infrastructure compared with other ASEAN countries [51].
Recently, Malaysia has started to strive towards low carbon emissions through implementing various green policies and energy
efciency (EE) programs [52]. The implemented policies are the
National Energy Policy (1979), National Depletion Policy (1980)
and Fuel Diversication Policy (1981, 1999) [53]. Moreover, the
Malaysian government has developed several policies to control
emissions from vehicles, such as [4951,54]:
i. Environmental Quality (Clean Air) Regulations 1978.
ii. Environmental Quality (Control of lead concentration in automobile gasoline) Regulations 1985.
iii. Environmental Quality (Control Emission from Diesel Engine)
Regulation of September 1, 1996.
iv. Environmental Quality (Control of Emission from Gasoline
Engines) Regulation on November 1, 1996.
Malaysia has adopted Euro 1 standards for diesel vehicles in
1997 and Euro 2 standards for gasoline vehicles in 2000. Malaysia
has also planned to move the adoption of Euro 2 standards for diesel
vehicles and Euro 3 standards for gasoline vehicles in 2007. Moreover, government has also planned to adopt Euro 4 standards by
2009. There is a mandatory six months inspection for commercial
vehicles to check for safety and level of emissions [49,50,54].
2.3.6.2. Indonesia. In Indonesia, fuel economy standards for vehicles are expected to be implemented in the near future, as they were
conrmed at the Conference of the Parties (COP-15) in December
2009. The current emission standards equivalent to Euro II was
implemented in 2006. Indonesia expects to advance to Euro IVequivalent emission standards by 2012 and working on plans to
upgrade their reneries to produce Euro IV compliant gasoline during 20142016 [55].
There are several policies in Indonesia which are relevant to
vehicle road worthiness and vehicle emissions. Indonesias Act No.
14 (1992) on Road Trafc and Transport states that in order to
prevent air and noise pollution, every motor vehicle must meet
emission and noise standards. The newly enacted Act No. 22/2009
which replaces the Act No. 14/1992 on Trafc and Road Transportation is the legal basis for the management of land transportation,
including the control of vehicle emissions. The Act stipulates that
the vehicle emission test is an integral part of the roadworthiness test. Hence, the responsibility for vehicle emission testing lies

with the transportation ofce, not with the environment ofce.

According to standards for new type motor vehicles and current
production, government regulations mandate that new vehicles
sold in Indonesia must comply with the Euro 2 standard started
from January 2005. While for other vehicle categories (passenger
car and motorcycle), the need for a road worthiness test will be covered by a separate Government Regulation which has to be issued.
Furthermore, no proposed fuel economy standards in Indonesia
have been implemented yet [12,49,50].
2.3.6.3. Thailand. In Thailand, emission standards for on-road vehicles has been formulated by the Pollution Control Department
(PCD) and being adopted by the Ministry of Industry (MOI) and the
Ministry of Science, Technology and Environment (MOSTE) [56]. In
2006, the Ministry of Environment also issued a longer list of air
emission control for both combustion and non-combustion processes industries. These standards are based on European standards
and emission test procedures for both gasoline and light duty diesel
vehicles [57]. Since January 2007, all new heavy duty vehicles are
required to comply with Euro 3 while new motorcycles should
comply with regulations for powered two- and three-wheeled
vehicles (97/24/EC) which require CO2 emission to be no more
than 3.5 g/km, and HC + NOx emission of no more than 1.82 g/km
[50,57].
2.3.6.4. Singapore. Singapore is one of ASEAN countries that has
implemented fuel economy standards. Singapore has introduced
and strictly enforced stringent emission standards. These standards
have been imposed for cars in use to identify and adopt the best
emission standards and fuel quality [49,5860]. Moreover, transportation planning and strategies has considered public transport
as the best choice to reduce demand for road space, to reach goods,
service, activities and destination with faster access and to reduce
distance travelled. In 2001, Singapore promoted the green vehicle
program by encouraging the purchase of hybrid and compressed
natural gas (CNG) and Green Vehicle Rebate (GVR) [49,50,61].
Moreover, all petrol- and diesel-driven vehicles are required to
comply with the Euro 2 (European Commission (EC) Directive
96/69/EC) exhaust emission standards in Singapore. Starting from
1st July 2003, all motorcycles/scooters were required to comply
with the exhaust emission standard as specied in EC Directive
97/24/EC before they can be registered for use in Singapore. From
1st October 2006, all new diesel vehicles are required to comply
with the Euro IV emission standard. All taxis will be of Euro IV standard by 2014, while all public buses will only be so in 2023 [50,62].
3. Survey data
To collect data on number of passenger cars in Indonesia, a
survey has been conducted. All of the data are collected from government, automobile manufactures and consumers. The data show
that passenger cars in Indonesia have increased rapidly, especially
in big cities. Generally, there are two types of passenger cars according to the type of fuel; petrol and diesel cars. Table 9 presents the
number of passenger cars in Indonesia between 1987 and 2008 [10].

2014

Year

Euro 4

Euro 4

2013
2012

Euro 2

2011
2010
2009

Euro 2

2008

Euro 2

2007
2006

Euro 3

4.1. Method of predicting data

2002

2003

Euro 1

2004

2005

Euro 2

4. Methodology

1999

2000

2001

Euro 2
Euro 2
Euro 2

This analysis is generally based on modeling methodologies to

gure out the potential fuel saving and emissions reduction from
passenger cars in Indonesia in the future. Some of the data are
already available but other data have to be estimated. In this paper,
the method used to estimate other necessary data is polynomial
curve tting. This method is an attempt to describe the relationship
between variable X as a function of available data and a response Y,
which seeks to nd some smooth curve that best ts the data, but
does not necessarily pass through any data points. Mathematically,

1998

Table 10
Input data for potential saving [15].
Euro 1

1997

1,170,103
1,073,106
1,182,253
1,313,210
1,494,607
1,590,750
1,700,454
1,890,340
2,107,299
2,409,088
2,639,523
2,769,375
2,897,803
3,038,913
3,261,807
3,403,433
3,885,228
4,464,281
5,494,034
6,615,104
8,864,961
9,859,926

Other necessary input data to perform calculation are: the fuel

economy standards, baseline fuel consumption without standards,
fuel price and fuel emission factor. Like any other developing country, it is difcult to get complete statistical or technical data for
analysis in Indonesia because of the lack of planning. However, estimated primary data inputs for analysis have been calculated based
on Ref. [15]. The complete results of input data are tabulated in
Table 10.

Description

Values

Fuel economy standards

Year standard enacted
Discount rate
Initial Incremental cost
Life span
Baseline fuel consumption
Average fuel price
Annual efciency improvement
Shipment survival factor
CO2 emission
HC emission
NOx emission
CO emission
Petroleum emission

1210 L/year
2015
7%
IDR 2,001,714
10 year
1426 L/year
IDR 6000/L
1.72%
100%
2.415 kg/L
53.98 g/L
44.76 g/L
114.5 g/L
1.9%

Gasoline.
Diesel.

Euro 1
Euro 1
Euro 1

1996
1995

Passenger cars

1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008

Indonesia
Malaysia
Philippines
Singaporea
Singaporeb
Thailand
Viet Nam

Country

Table 8
Vehicles emissions standards in ASEAN countries [49,50].

3553

Table 9
Statistical data on passenger cars in Indonesia [10].

E4

2015

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

USD 1 = IDR 9800.

3554

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

a polynomial of order k in X is expressed in the following form

[4,14,6365]:
Y = C0 + C1 X + C2 X 2 + + Ck X k

(1)

4.2.7. Total fuel saving

Total fuel savings in a particularly year is the multiplication of
the total stock of the passenger cars and the unit fuel savings in
the particularly year. The total fuel savings can be expressed in
mathematical from as the following equation [4,14,63,65]:

4.2. Method of calculating potential fuel savings

p

The potential fuel saving is calculated based on shipment,

shipment survival factor, applicable stock, total efciency improvement, scaling factor, unit fuel savings, and total fuel saving. The
descriptions of each variable are discussed below:
4.2.1. Shipment
Shipment is the difference between the numbers of passenger
cars in predicting years minus the number in previous year plus the
number of retired passenger cars in the current year. In mathematical form this can be expressed by the equation [4,14,63,65,66]:
p

Shi = (N vi N vi1 ) + N vi1

(2)

4.2.2. Shipment survival factor

The shipment survival factor is a function of the annual retirement rate and the retirement function. If the standards setting is
shorter than 2/3 of the average lifespan of product, shipment survival factor will be 100%. Shipment survival factor for passenger car
can be calculated using the following equation [4,14,63,65,66]:

p
SSFi

=1

(Yshi Yses )(2/3)Lp

(2/3) Lp

(3)

TFSi =

ASi = (Shi SSFi + ASi1 )

(4)

4.2.4. Total efciency improvement

Total efciency improvement is a ratio of initial unit fuel savings and baseline fuel consumption of passenger cars when the
fuel economy standard programs are enacted. The total efciency
improvement is usually presented as a percentage. Thus, it can be
expressed by the following equation [1315,63,6568]:
p

TFIs =

UFSs

BFCs

100%

(5)

4.2.5. Scaling factor

The scaling factor is the ratio of annual efciency improvement and the total efciency improvement. The scaling factor
would linearly scale down the unit fuel savings and the incremental cost to zero over the effective period of the standards. The
scaling factor can be expressed in a mathematical form as follows
[13,14,63,6569]:
p

SFi = 1 (Yshi Ysei )

AFIi

p
TFIs

(8)

The economical impact is a function of the energy savings and

investment cost of more efcient passenger cars due to the standards. The economic impacts of the standards are the potential
bill savings, the net savings and the cumulative present value. The
description of each variable is given below:
4.3.1. Bill savings
Bill saving is a function of the total fuel savings multiplied by
the average fuel price. This is can be expressed by the following
equation [4,14,65,70]:
p

BSS = TFSi PFi

(9)

4.3.2. Capital recovery factor

Capital recovery factor is the correlation between discount rate
and lifetime of the passenger car. This correlation expressed by the
following mathematical equation [4,14,65,70,71]:
d
(1 (1 + d)

(10)

4.3.3. Net savings

There are two ways to determine economic impact, e.g., annualized costs and cash ow. In the rst method, the incremental cost
is spread over the lifetime of the car so that the pattern of expenditures matches the ow of bill savings. This method smoothen the
net savings over time and calculated using the following equation
[14,65,70,71]:
p

ANSi = TFSi PFi

T


ASi CRF SFi IICs

(11)

i=s

The second method is the cash ow over the lifetime of the

investment, which assumed that the passenger car is paid for in
full when it is purchased. Purchaser incurs the incremental technology cost when the car is purchased, but benets of higher energy
efciency are spread over lifetime of the car. This is calculated by
the following equation [4,14,65,70,71]:
p

NSi = TFSi PFi Shi IICs

(12)

4.3.4. Cumulative present value

The cumulative present value is a function of annual cost savings
and the percentage of real discount rate. The cumulative present
value of annualized net savings can be calculated by the following
equations [4,14,65,70,71]:
p

PV (ANSi ) =

(7)

4.3. Economic impact of standards

(6)

4.2.6. Unit fuel savings

The initial fuel savings is the difference between baseline fuel
consumption and standard fuel consumption of passenger car. The
initial unit fuel savings is calculated using the equation below
[4,1315,63,66]:
UFSs = BFCs SFCs

ASi UFSi SFi

i=S

CRF =
4.2.3. Applicable stock
The applicable stock is the stock of the passenger cars in
a particular year and the number of cars affected by the fuel
economy standards in previous year. The equation is as follows
[4,1315,63,6568]:

T


T

i=sc

ANSi
(1 + d)

(1Ydb)

(13)

4.4. Environmental impact of the standards

The environmental impact of the standard is the potential emission reduction. The common emissions from fossil fuel passenger
cars consist of CO2 , HC, NOx and CO. The emissions reduction is

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558
6000

Fule Saving (Milion L/year)

Table 11
Prediction of numbers of passenger cars between 2015 and 2023.
Year

Number of passenger cars

14,835,331
16,057,422
17,332,115
18,659,410
20,039,308
21,471,807
22,956,909
24,494,614
26,084,920

2015
2016
2017
2018
2019
2020
2021
2022
2023

3555

4880

5000

4426

3728

4000
3000
2000

4887

4473

3426

2700
1809
1442

1000
0

a function of energy savings. The environmental impact can be

calculated by the following equation [4,14,63,65,70,71]:

2015

2016

2017

2018

2019

2020

2021

2022

2023

(14)

Fig. 7. Annual fuel saving by implementing fuel economy standards for passenger
cars.

As have been stated in the methodology, polynomial curve tting is a suitable approach to predict future data. Using Eq. (1) and
based on the data shown in Table 9, the total number of passenger
cars between 2015 to year 2023 can be predicted by the following
equation [72]:

years, savings grow as the stock of high efciency passenger cars

increases, but they grow at a declining rate because the savings on
the units purchased later have smaller fuel savings. However, there
is one point to remember. The cost of effectivenes of the fuel efciency standard depends on the cost of the fuel supply. The higher
the cost of fuel of oil, the faster the efciency standard pays back to
society. In other words, even in the absence of standards, the fuel
economy of passenger cars tends to improve gradually over time
due to technology advances.

ERi = TFSi (Em1 + Em2 + Em3 + + Emk )

5. Result and discussions
5.1. Data analysis

TN cars = 26, 301.10x2 277, 071.73x + 1, 973, 276.59,

R2 = 0.93

The result of the predicted number of passenger cars in Indonesia

from 2015 to 2023 using the above polynomials equation is shown
in Table 11.
5.2. Fuel saving
The energy impact of standards is the potential energy savings
by implementing fuel economy standards for the passenger cars.
The standard is only effective for certain period of years because
the fuel economy of the passenger cars is gradually improved. In
the absence of the standard, the fuel efciency of the passenger
cars tends to improve gradually over time due to technological
advances.
Using Eqs. (2)(8), input data in Tables 10 and 11; the results
of fuel saving between 2015 and 2023 are presented in Table 12
and Fig. 7, respectively. These results show that the annual fuel
saving from fuel economy standrads increase year by year of the
anlysis period and maximum in the middle and this saving down
slowly. Each year, old, ineecient (pre-standars) passenger cars are
replaced by new units meeting standards. Over a period of time, the
projected techonological improvement on the base line begins to
catch up the standards. Since the savings on new passenger cars are
calculated relative to the base line in the year the car was purchased,
the savings on new units is lower in the lates years. For the rst few

5.3. Economical impact

The economic impact consists of the potential bill savings,
annual net savings, net savings and cumulative present value. The
economic impact is actually a function of the energy savings and
investment for more efcient appliances due to the standards. The
comprehensive description of each variable is explained in the
following sections. Using Eqs. (9)(13), Table 10 and Fig. 7, the
calculation results of bill savings, annual net savings, and cumulative present value are tabulated in Table 12 and illustrated in
Fig. 8. The standard program implemenation from 2015 to 2023
will save about IDR 190,640 billion (USD 19 billion), annualized
net saving is IDR 148,717 billion (USD 15 billion), and net saving
about IDR 103,435 billion (USD 11 billion), respectively. It must
be remembered that, all these results are just rough estimations.
Nevertheless, it proved that introducing fuel efciency standards
for passenger cars offer great economic benets for consumers in a
developing country like Indonesia.
5.4. Environmental impact
The environmental impact of fuel economy standards is a
function of fuel saving which is the potential reduction of emissions that cause negative impact to the environment. Using Eq.
(14), Table 10 and Fig. 7, the results of emissions reduction are

Table 12
Result of the fuel saving and economical impact of fuel economy standards between 2015 and 2023.
Year

Sh

AS

SF

UFS (L/year)

FS (million
L/year)

BS (billion
IDR)

ANS (billion
IDR)

NS (billion
IDR)

PV(ANS)
(billion IDR)

2015
2016
2017
2018
2019
2020
2021
2022
2023

6,677,030
7,425,701
8,226,975
9,080,850
9,987,328
10,946,408
11,958,090
13,022,375
14,139,261

6,677,030
14,102,732
22,329,707
31,410,558
41,397,887
52,344,295
64,302,386
77,324,761
91,464,023

1.000
0.886
0.773
0.659
0.546
0.432
0.319
0.205
0.092

216
191
167
142
118
93
69
44
20

1442
2700
3728
4473
4880
4887
4426
3426
1809

8653
16,202
22,367
26,841
29,283
29,322
26,558
20,557
10,856

6750
12,639
17,448
20,938
22,843
22,874
20,718
16,037
8469

4712
3025
9639
14,856
18,371
19,851
18,930
15,210
8264

6750
11,812
15,240
17,092
17,427
16,309
13,805
9987
4929

3556

Letter to the Editor / Renewable and Sustainable Energy Reviews 16 (2012) 35473558

Table 13
Total emissions reduction by introducing fuel economy standards between 2015
and 2023.
CO2 (tons)

HC (kg)

NOx (kg)

CO (kg)

2015
2016
2017
2018
2019
2020
2021
2022
2023

66,177
123,903
171,052
205,264
223,939
224,243
203,104
157,213
83,023

1,479,188
2,769,471
3,823,353
4,588,051
5,005,483
5,012,279
4,539,774
3,514,009
1,855,734

1,226,537
2,296,434
3,170,310
3,804,394
4,150,527
4,156,162
3,764,363
2,913,802
1,538,767

3,137,590
5,874,480
8,109,930
9,731,972
10,617,411
10,631,827
9,629,569
7,453,762
3,936,302

HC

10,000,000

Emission reduction (kg)

Year

12,000,000

NOx
CO

8,000,000

6,000,000

4,000,000

2,000,000

2015

Table 14
Total emissions reduction by introducing fuel economy standards between 2015
and 2023.
Emissions

CO2 (tons)

HC (kg)

NOx (kg)

CO (kg)

Total

1,457,918

32,587,345

27,021,296

69,122,843

tabulated in Table 13 and illustrated in Figs. 9 and 10, respectively.

The results show that the emission reduction increase slowly in the
beginning of the analysis period then increases to maximum in the
middle of the period following the fuel saving trend. Total emission
reductions for CO2 , HC, NOx and CO are tabulated in Table 14. The
accumulation of these emission reductions will help to reduce the
negative impact it has on the environment.

35000
BS
30000

ANS
NS

25000

PV

Billions IDR

20000
15000
10000

2016

2017

2018

2019

2020

2021

2022

2023

Fig. 10. Annualized NOx , HC and CO emissions reduction due to passenger cars fuel
economy standards.

6. Conclusions
Fuel economy standards for passenger cars are relatively cheap
measure to inuence consumers and to induce market information by encouraging car manufacturers to produce more efcient
cars. Due to the increasing number of passenger cars in Indonesia,
fuel consumption and therefore emission production will grow
rapidly in the future if a well-planned strategy is not adopted by
the government at the moment. Therefore, to reduce this increasing consumption, fuel economy standards for passenger have been
suggested as a proper solution. Fuel economy standards provide
benets to the national economy and environment. The present
study has demonstrated the potential of implementing fuel economy standards for passenger cars in Indonesia. It has been found
that, a total amount of 32 billion litre, IDR 190,640 billion (USD
19 billion) and 1,457,918 ton CO2 could be saved between 2015
and 2023 due to implementation of fuel economy standards. In
summary this study indicates that the fuel economy standard of
passenger cars is one of the most effective strategies to reduce fuel
consumption and mitigate emission production. The cooperation
between governments, manufacturers, consumer of passenger cars
to implement this strategy is vital and can ensure the success of this
fuel saving approach.

5000

Acknowledgements

0
2014
-5000

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

-10000

Fig. 8. Result of economical impact by passenger cars standards in IDR.

References

250,000
223,939 224,243
205,264

203,104

200,000
CO2 reduction (tons)

The authors would like to acknowledge for the Ministry of Higher Education of Malaysia and The University of
Malaya, Kuala Lumpur, Malaysia for the nancial support under
UM.C/HIR/MOHE/ENG/15 (D000015-16001).

171,052
157,213

150,000
123,903

100,000

83,023
66,177

50,000

0
2015

2016

2017

2018

2019

2020

2021

2022

2023

Fig. 9. Annualized CO2 emissions reduction due to passenger cars fuel economy
standards.

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A.E. Atabani a,b,

Department of Mechanical Engineering, University
of Malaya, 50603 Kuala Lumpur, Malaysia
b Department of Mechanical Engineering, University
of Khartoum, P.O. Box 321, Khartoum, Sudan
a

A.S. Silitonga a,b

Department of Mechanical Engineering, University
of Malaya, 50603 Kuala Lumpur, Malaysia
b Department of Mechanical Engineering, Medan
State Polytechnic, Medan 20155, Indonesia

T.M.I. Mahlia a,b

Department of Mechanical Engineering, University
of Malaya, 50603 Kuala Lumpur, Malaysia
b Department of Mechanical Engineering, Syiah Kuala
University, Banda Aceh 23111, Indonesia
a

Corresponding author at: Department of

Mechanical Engineering, University of Malaya,
50603 Kuala Lumpur, Malaysia.
Tel.: +60 122314659.
E-mail address: a atabani2@msn.com (A.E. Atabani)

13 January 2011
Available online 20 March 2012