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Cost Benefit Analysis for Fuel Quality and Fuel Economy Initiative in Indonesia.

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A policy evaluation is needed by goverment when they want to issue a regulation, particularly if that proposed policy will affect market prices, import duties, taxes, subsidies or other charges imposed on production and distribution process. Costs- benefits analysis as well as Cost-effectiveness analysis are needed by policy makers to evaluate policies about their policy effects on economic efficiency, contribution to the alleviation ofpoverty, and support for good governance. This study identified policy options that are expected to give effect to the reduction ofemissions and ultimately provide economic benefits for Indonesia. Cost benefit and cost-effectiveness analysis is used to evaluate several policy options and provide recommendations the most appropriate policy options. Many studies have shown that emissions from motor vehicles have a very significant impact to the quality of life of the people, especiallyin urban areas. A high level pollutant is harmful to public health and can be ultimately reduce people’s productivity in work and also potentially required addition cost of living for health maintenance. Jakarta case in 2010 for instance, 57.8% people were suffered by various air pollution-related illness and disease, and paid IDR 38,5 Trillion to treating its. Therefore efforts to reduce emissions from motor vehicles produce air pollution as well as green house gas (GHG) is very important action to give impact on public health and the environment, and global warming mitigation. In addition, with the high price of international crude oil and the same time the declining of oil reservesof Indonesia, the need for a reduction in fuel consumption of the vehicle must begin to do by thinking to make an efforts in developing alternative fuels. Fortunately, there effort to reduce vehicle emissions will indirectly affect to the need of fuel subsidy which is quite burden for national budget.
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... A limited number of studies have been conducted on the health and economic burdens attributable to air pollution in Jakarta. However, the studies mainly looked at acute symptoms and incidence of diseases attributable to air pollution, such as asthma attacks, respiratory symptoms, the incidence of COPD, incidence of pneumonia, incidence of bronchitis, and incidence of other respiratory illnesses [34][35][36][37]. A study by Resosudarmo & Napitupulu predicted 7900 deaths due to air pollution in 2015 [35]. ...
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(1) Background: This study aimed to quantify the health and economic impacts of air pollution in Jakarta Province, the capital of Indonesia. (2) Methods: We quantified the health and economic burden of fine particulate matter (PM2.5) and ground-level Ozone (O3), which exceeds the local and global ambient air quality standards. We selected health outcomes which include adverse health outcomes in children, all-cause mortality, and daily hospitalizations. We used comparative risk assessment methods to estimate health burdens attributable to PM2.5 and O3, linking the local population and selected health outcomes data with relative risks from the literature. The economic burdens were calculated using cost-of-illness and the value of the statistical life-year approach. (3) Results: Our results suggest over 7000 adverse health outcomes in children, over 10,000 deaths, and over 5000 hospitalizations that can be attributed to air pollution each year in Jakarta. The annual total cost of the health impact of air pollution reached approximately USD 2943.42 million. (4) Conclusions: By using local data to quantify and assess the health and economic impacts of air pollution in Jakarta, our study provides timely evidence needed to prioritize clean air actions to be taken to promote the public’s health.
... It is estimated that in 2010, 57.8% of the residents of Jakarta experienced air-pollution related diseases such as asthma, broncho-pneumonia, and chronic obstructive pulmonary disease. The associated social cost was estimated to be around 38.5 trillion Indonesian rupiahs (US$3.0 billion), a figure that not include any estimate of the reduction in the productive capacity of the workforce (Safrudin et al., 2013). Thus, it is expected that transport emissions management policies could bring significant health benefits while also contributing towards the containment of the socio-economic costs of local air pollution. ...
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To develop efficient strategies for pollution control, it is essential to assess both the costs of control and the benefits that may result. These benefits will often included improvements in public health, including reductions in both morbidity and premature mortality. Until recently, there has been little guidance about how to calculate the benefits of air pollution controls and how to use those estimates to assign priorities to different air pollution control strategies. The author describes a method for quantifying the benefits of reduced ambient concentrations of pollutants (such as ozone and particulate matter) typically found in urban areas worldwide. The author then applies the method to data on Jakarta, Indonesia, an area characterized by little wind, high population concentration (8 million people), congested roads, and ambient air pollution. The magnitude of the benefits of pollution control depend on the level of air pollution, the expected effects on health of the pollutants (dose-response), the size of the population affected and the economic value of these effects. The results for Jakarta suggest that significant benefits result from reducing exposure to both outdoor and indoor air pollutants. For example, if annual concentrations of particulate matter were reduced to the midpoint of the World Health Organization guideline (and former U.S. ambient standard), the estimates indicate a reduction per year of 1,400 premature deaths (with a range of 900 to 1,900), 49,000 emergency room visits, 600,000 asthma attacks, 7.6 million restricted activity days (including work loss), 124,000 cases of bronchitis in children, and 37 million minor respiratory symptoms. In the case of Jakarta, the methodology suggests that reducing exposure to lead and nitrogen dioxide should also be a high priority. An important consequence of ambient lead pollution is a reduction in learning abilities for children, measured as I.Q loss. Apart from that, reducing the proportion of respirable particles can reduce the amount of illness and premature mortality. Clearly, air pollution represents a significant public health hazard to residents of Jakarta and other cities consistently exposed to high levels of air pollution, such as Bangkok, Mexico City, and Santiago, Chile.
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Cleaner Fuels, Policy Guidelines for Reducing Vehicle Emission in Asia
ADB, (2003). Cleaner Fuels, Policy Guidelines for Reducing Vehicle Emission in Asia [http://www.adb.org/documents/guidelines/Vehicle_Emissions/cleaner_fuels.pdf].
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Biswas, S. K.; Tarafdar, S. A.; Islam, A.; Khaliquazzaman, M.; Tervahattu, H., and Kupiainen, K., (2003). 'Impact of Unleaded Gasoline Introduction on the Concentration of Lead in the Air of Dhaka, Bangladesh' Air and Waste Management Association, November (based on www.awma.org/journal/ShowAbstract.asp?Year=2003 &PaperID=1139).
Fuel Quality and Vehicle Emission Standards: Cost and Benefit Analysis , prepared for MVEC Review of Vehicle Emissions and Fuel Standards Post
  • Pty Coffey Geoscineces
  • Ltd
Coffey Geoscineces Pty Ltd (2003). Fuel Quality and Vehicle Emission Standards: Cost and Benefit Analysis, prepared for MVEC Review of Vehicle Emissions and Fuel Standards Post 2006, Coffey, Australia CURRENT TRANSPORTATION ISSUES IN JAKARTA AND ITS IMPACTS ON ENVIRONMENT, Proceedings of the Eastern Asia Society for Transportation Studies, Vol. 5, pp. 1792 -1798, 2005