Thanks to Hans Nicholas Jong
- The Indonesian government will still permit the construction of new coal-fired power plants, despite recently signing a $20 billion energy transition financing deal with industrialized countries.
- The plants are accommodated in the government s 10-year energy plan and covered by a presidential regulation.
- The newly announced Just Energy Transition Partnership (JETP), by contrast, doesn t make clear what restrictions if any, it puts in place on Indonesia building new coal plants.
- Activists have called for a complete ban on new coal power so that a just energy transition can happen as envisioned in the new climate finance partnership.
Despite a recent $20 billion agreement with the G7 group of industrialized countries to aid it in its transition to sustainable energy, Indonesia will keep constructing new coal-fired power facilities.
Activists claim that this puts the Just Energy Transition Partnership agreement, which was signed at the G20 conference that Indonesia hosted earlier this month, in danger of disintegrating before it even gets off the ground.
According to Andri Prasetiyo, a researcher at Trend Asia, a Jakarta-based charity that promotes the transition to sustainable energy, JETP in Indonesia runs a significant danger of failing in its attempt to decarbonize [Indonesia’s] power system. This is due to the government’s ongoing deployment of conflicting signals in the energy transition by failing to provide a firm timeline for halting the development of new coal-fired power plants.
Indonesia will strive to cap its emissions from the power sector by 2030, earlier than the planned objective of 2037, and to produce 34% of its electricity from renewable sources by that year, under the agreement, the single largest climate finance cooperation to date.
The construction of new coal plants, which have already been tendered out and have a combined 13 gigawatts of power, will nevertheless be permitted by the Indonesian government. The program is described in the nation’s ten-year energy plan for 2021–2030. Importantly, a law released in 2022 by President Joko Widodo permits the development of captive coal plants, which are created expressly to supply specific sectors rather than the grid.
According to a joint statement from Indonesia and its JETP partners, which also include the G7 and Denmark, and Norway, they want to limit the construction of captive coal-fired power plants in accordance with the 2022 presidential directive. They say that the cooperation must continue if no new coal plants are built in areas where timely, emission-free, cost-effective, and dependable alternatives can be found. The alliance also calls for the creation of a plan to prevent the creation of new coal-fired power plants and to identify investments in renewable energy as captive-coal alternatives.
The Indonesian Center for Environmental Law’s program director, Grita Anindarini, claims that any constraints the JETP imposes on captive coal are still unclear (ICEL). She urged the Indonesian government to change any rules and guidelines that continue to support the development of additional coal power and obstruct the just energy transition envisioned in JETP. The construction of new coal power plants is expressly permitted, according to the 2022 presidential rule, according to Grita.
Behind behind China, the United States, India, and the entire EU, Indonesia was the fifth-largest emitter of greenhouse gases in the world in 2019. Deforestation and coal combustion, which account for 61% of the nation’s energy generation, are the main sources of its emissions.
Since Indonesia’s economy is the largest in Southeast Asia and ranks 17th globally in terms of nominal GDP, it is expected that emissions from the electricity sector would continue to rise. In particular, it is anticipated that captive coal for industrial parks will expand by 9.5 gigawatts to support the nation’s mineral-processing sector, which includes the production of the nickel used in electric vehicle batteries.
The problem with captive coal plants almost prevented the JETP from being realized. The main issue impeding the JETP deal, according to sources from the EU’s diplomatic staff for the Council of the EU, was a 5 GW captive coal power plant in Indonesian Borneo. The donor organization stated that the contract would be off the table if that project went forward.
With the agreement in place for the time being, Indonesia and the donor nations must create an investment plan over the following six months that includes information on where the financing will come from and how it will be used.
According to Grita from ICEL, this investment plan should be more specific than the initial joint statement about restrictions on new coal plants.
The public should also be consulted in the creation of the plan, especially communities that may be impacted by the energy transition program, according to Tata Mustasya, coordinator of Greenpeace Indonesia’s climate and energy campaign.
According to him, JETP must always be conducted in an open, participatory, and responsible manner if it is to meet its objectives.
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Even when their plants are shut down as part of the partnership, the investment plan, according to Grita, should ensure that coal plant operators are held accountable for the harm they have caused to populations living nearby.
She claimed that numerous coal plants had hurt people as well as impacted the environment. The [Indonesian] government must ensure that the funding plan doesn’t eliminate the obligation of plant owners to restore the environment and settle disputes, particularly with impacted populations.