Eco-innovation driven energy transition: a case study of the energy for transportation sustainability in Indonesia

This research investigates the influence of eco-innovation on Indonesia’s socio-technical transition from fossil-fuel dependence to alternative fuels and low-carbon mobility within the transportation sector. Utilizing a mixed-methods approach that combines qualitative and quantitative analyses, the study addresses the overarching research question: how does the diffusion of low-carbon eco-innovations shape the transition towards sustainable transportation in Indonesia? The findings show that global environmental and sustainability agendas have directly shaped the development of alternative fuels and sustainable public transport. Knowledge spillovers from low-carbon technologies, including biofuels, electric vehicles, and natural gas, have driven the rise of niche innovations. The diffusion of bus rapid transit, commuter rail, and mass rapid transit further supports these socio-technical transitions. As landscape pressures interact with niche innovation, they create key critical junctures and open windows of opportunity, pushing Indonesia’s socio-technical regime to reform sustainability-related institutions.
The thesis also shows that unequal power dynamics shaped Indonesia's transport energy transition. Government agencies, energy firms, palm oil industries, and automotive makers have the greatest influence on alternative fuel policies and create path dependencies. Meanwhile, smallholder farmers, MSMEs, lower- and middle-income urban consumers, and rural communities remain far less influential in diffusing these innovations, highlighting their ongoing marginalization in the transition process. The diffusion of eco-innovation produces specific outcomes, notably increased use of biofuels and electric vehicles driven by regulatory support, knowledge spillovers, collaborative networks, and green market sensing. Yet, persistent barriers—such as regulatory uncertainty, infrastructure gaps, costs, and limited awareness—hinder broader adoption. For electric motorcycles, public preferences shape market uptake, influenced by factors including demographics, travel patterns, policy support, technology, affordability, and charging infrastructure. Circular economy initiatives generate sustainability benefits when supported by stronger regulatory and institutional frameworks. Thus, while certain factors enable the adoption of low-carbon technologies, significant obstacles continue to limit their widespread impact. By applying innovation diffusion and technology adoption theories to an emerging economy, this thesis deepens the understanding of how socio-technical transition dynamics, innovation diffusion, social acceptance of technology, and power relations shape sustainable transportation energy. It offers policy and industry insights to achieve a more inclusive, equitable, and sustainable energy transition in Indonesia’s transport sector.