<![CDATA[Renewable energy resources in Indonesia is very large, but has not exploited yetas the demand for renewable energy is still low, especially for Biofuel (biodiesel and bioethanol)also known as Bahan Bakar Nabati (BBN).People prefer to use Fuel (BBM) than Biofuel because fuel price is cheaper,caused byfuel subsidy. This study analyzes energy subsidies in the context of renewable energy development using a descriptive qualitative approach. The result shows that fuel subsidy causes bigger oil and gas balance deficits, and burden the state budget because of fluctuations in world crude oil prices were very high. In addition, fuel subsidies also considered less targeted because the subsidy is enjoyed by many agent. Thus, the government needs to transfer the use of BBM to BBN by preparing the downstream sector of the biofuel industry. Also, the price of biofuel produced by the producers is bought in accordance with the economic price. Furthermore, the price of subsidized biofuel is optimized so that it can compete with BBM.]]>
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