Acceleration of the Energy Transition in Indonesia

To achieve NZE levels, Indonesia needs to increase its decarbonisation efforts in the energy sector. Indonesia is currently developing a scenario to phase down/out coal-fired power plants. However, it is essential to remember that when Indonesia does this, the electricity supply must be met from non-fossil-fuel power plants. Thus, there is a need to develop a phase-in scenario for renewable energy to fulfil the electricity supply that previously supplied by the fossil fuels.

In order to do this energy transition, Indonesia need to take advantage of existing funding opportunities such as Just Energy Transition Partnership (JETP) and Energy Transition Mechanism (ETM). Both JETP Indonesia and ETM Country Platform were announced in the 2022 G20 Summit in Bali last year. Hence, Indonesia must identify what it needs to enable the right environment for cooperation that does not violate basic principles based on the Indonesian constitution from 1945. There are seven principles that must be implemented to realise Indonesia’s just energy transition. These seven principles are justice, legal certainty, expediency, human rights, environmental protection (including the utilisation of sustainable environmental management, equitable efficiency and energy independence), transparency (including public participation and information disclosure), and the principle to collaborate in the drafting of policies and regulations.

This background paper present Indonesia’s energy transition plan including the readiness of Indonesia’s renewable energy sector, enabling conditions for an equitable energy transition in Indonesia, leveraging financing for energy transition in Indonesia and views from civil society organisations in regards to the principles that need to be applied for an equitable energy transition.

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May 26, 2023

Acceleration of the Energy Transition in Indonesia