Indonesia's efforts to decarbonize the country's power generation sector took a significant step forward on Feb. 22 when the government initiated the first phase of mandatory carbon trading for coal-fired power plants.
Coal accounts for more than half of Indonesia's electricity generation. The first stage of a carbon trading mechanism will cover 99 power plants with a total installed capacity of 33.6 GW that are directly connected to state utility Perusahaan Listrik Negara's power grids (PLN).
The nation’s carbon trade applies to power plants with a capacity of at least 100 MW. Energy minister, Arifin Tasrif, said that it would later be expanded to cover smaller coal-fired plants and other fossil-fuel-powered facilities, as well as plants that are not linked to the PLN grid.