Indonesia finalizes renewables target with G7 climate finance plan


Indonesia has officially finalized the Comprehensive Investment and Policy Plan (CIPP), aiming to persuade the members of the Just Energy Transition Partnership (JETP) to secure $20 billion in funds for green energy transformation on Nov. 21.

The Indonesian JETP Secretariat announced the CIPP draft in early November and released the final content after about 3 weeks of public consultation. The CIPP document focuses on an on-grid electricity system with a decarbonization scenario of 250 million tons of CO2 with a share of renewable energy reaching 44% in 2030. In addition, the JETP roadmap also stipulates achieving net zero electricity emissions by 2050.

The Cirata floating solar farm in in West Java. (Photo: PLN)

The plan outlines 400 priority projects that must be initiated before 2030, estimating a required funding of $66.9 billion. Edo Mahendra, the General Secretary of Indonesian JETP, emphasized that the $20 billion committed by JETP should be seen as a "catalyst," with the hope of attracting more investments in the future.

JETP itself or the Just Energy Transition Partnership, is a financing program that involves members of the Group of Seven (G7), multilateral development banks, and private lending institutions providing equity investments, grants, and concessional loans. The goal of the program is to assist developing countries in the transition to clean energy in the energy sectors. Indonesia is the largest beneficiary of JETP funds, receiving a total allocation of $20 billion. However, the timing of when these funds can be utilized depends on the content of the CIPP.

The official statement from the United States Embassy in Indonesia indicates that through the CIPP, Indonesia is expected to achieve goals related to carbon emission restrictions, the development of renewable energy, and achieving net-zero emissions by 2050. Erick Tohir, Indonesia’s Coordinating Minister for Maritime Affairs and Investment, stated that "CIPP provides a strategic roadmap for Indonesia's energy transition and addresses issues related to technology, finance, politics, and social justice."

However, Bhima Yudhistira, the Director of the Center for Economic and Legal Studies in Indonesia, believes that the recently announced plan shows no significant changes compared to the draft. This is because it doesn’t mention any plans to accelerate the termination of high-carbon-emission coal power plants, and the scope is limited to only two power plants. This creates a contradiction with the JETP plan, which aims to increase the share of renewable energy before 2030.

In addition, the head of the non-profit organization Greenpeace Indonesia, Leonard Simanjutak also stated that CIPP has limited impact on Indonesia's energy transition development because the plan doesn’t include captive coal power plants. The generation capacity of such power plants has significantly and continue to increase from 1.3 GW in 2013 to 10.8 GW this year, posing a significant obstacle to Indonesia's goal of achieving net-zero carbon emissions.

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