Implementation of Energy Management and Systems Optimization Projects
Policy measure

According to GEF (2011), the project titled ‘Promoting Industrial Energy Efficiency through System Optimization and Energy Management Standards’ in Indonesia is to be implemented by the United Nations Industrial Development Organization (UNIDO) with support from the Indonesian Ministry of Energy and Mineral Resources (MEMR), the Ministry of Industry (MOI) and Badan Standardisasi Nasional (BSN). The objective of the project is to “promote industrial energy efficiency through system optimization approach and introduction of ISO energy management standards” (GEF, 2011).

Component 4 of the project, Implementation of Energy Management and Systems Optimization Projects, aims to increase the adoption of energy management standards and systems optimization energy efficiency projects by industries for higher energy savings on a continuous basis. Sub-component 4.2 specifically aims to support the implementation of systems optimization projects in industrial enterprises. (GEF, 2011) 

Total project cost is estimated at USD 16.355.380 of which USD 12.725.000 is reserved for Component 4 (GEF, 2011). 


The following planned activities are to take place within Sub-component 4.2 (GEF, 2011):

  • “Complete 60 systems assessment by the trained Indonesian experts nationwide with limited support from UNIDO international experts.

  • Implementation of 35 systems optimization projects. This will lead to completed systems optimization projects, which will be developed using the UNIDO tools.

This output will also lead to lessons learnt (success stories, but also failed cases) from the demonstration projects implemented in order to promote energy management standards and systems optimization in the industry sector in Indonesia. The information on the project and the promoted concept will be available for both participating and nonparticipating industries.

Out of the 35 completed projects, 20 projects are planned to be documented as case studies.. The case studies will be developed illustrating financially attractive investments in efficiency improvements for steam, pumps, and compressed air systems. They will document the energy and GHG emission savings directly attributable to the project. They will also be used in the subsequent factory training by the national experts.”


To achieve the objectives of Sub-component 4.2, it is necessary to work under the assumption that “sufficient commitment from industrial enterprises to take action on systems optimization following systems assessment assumption” is present in the implementing environment (GEF, 2011).


The following outcomes of Sub-component 4.2 are targeted by the GEF (2011):

  • “60 systems assessments conducted of which 35 led to completed systems optimization projects.

  • 20 case studies showing GHG emission reductions.

The industrial demonstration projects and training activities are expected to result in direct electricity and fuel savings of 37,484 MWh and 404,000 GJ during project period.”

According to GEF (2011), the expected outcome of the overall project is a “reduction in electricity and fuel consumption due to adoption of system optimization and energy management standards by industrial enterprises. The direct electricity and fuel saved from the successful implementation of the project will lead to a reduction of carbon dioxide emission (CO2) which is estimated at 67,442 tones of CO2 over the project lifetime. The indirect savings after project completion, resulting due to capacity development and introduction of ISO50001 is estimated at 522,960 tones of CO2.”


GEF (Global Environmental Facility), 2011. Indonesia: CF: Promoting Energy Efficiency in the Industries through System Optimization and Energy Management Standards. Available at: