Using agent-based modeling to explore policy options supporting adoption of natural gas vehicles in Indonesia

The diffusion of Natural Gas Vehicles (NGVs) has been slow although the government has already developed infrastructures and regulations to enable the uptake. This paper attempts to understand the consumers' adoption decision-making and to explore potential policy interventions favoring the uptake. Two models are compared: a non-psychological model and a psychological model. Using Agent-based Social Simulation, the psychological model was found to offer a better explanation for underlying mechanisms of the adoption decision. The results indicate that individual interventions largely fail to induce long-term NGV diffusion. To promote a sustaining market share of NGVs at 14% in 2030, a combined intervention should be introduced that includes: a converter kit subsidy of 5 M Rupiah for five years, a gradual increase of annual tax for oil-fueled vehicles to 2.5% in 2030, increased perceived safety of NGVs to the same level as that of Low Cost Green Cars, and additional gas fueling stations.