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Indonesia's Clean Energy Plan Hits Snag Due to Technical Challenges

Published: 8.29.2023

Indonesia's progress towards adopting cleaner energy sources has encountered a challenge. The nation has chosen to postpone the announcement of its Just Energy Transition Partnership, citing the need for additional time to establish a technically reliable route forward.

The delay is seen as a setback for Indonesia's goal to reduce its impact on the environment. Currently, the country is one of the world's largest coal producer and ranks tenth in greenhouse gas emissions. Indonesia aims to achieve "net-zero emissions" by 2060, meaning it wants to balance the amount of greenhouse gases it releases with what it removes from the atmosphere. But critics say the nation is moving too slowly towards this goal.

This hurdle comes after private discussions held over nine months following an agreement made between Indonesia and several global partners, mainly led by the United States and Japan. The agreement was established during the G20 conference in Bali.

The discussions revealed that the main challenges have been disagreements about where the funding should go and the complex technical problems associated with moving from coal to renewable energy.

This collaboration aims to ensure that Indonesia's power sector emits the most greenhouse gases by 2030, after which the emissions will start to decrease. The ultimate target is to achieve "net-zero emissions" by 2050, a decade earlier than initially planned. Additionally, the goal is for at least 34% of the country's total power generation to come from sustainable energy sources by 2030.

Indonesia currently relies on coal for almost half of its power generation. Although renewable energy saw a small decrease in usage recently, coal consumption hit a record high in 2022. Developed countries have promised financial assistance to help Indonesia change this course.

Indonesia's plans to build more coal-based power facilities to support metal smelting have caused concerns. A group of NGOs recently wrote to the fund's backers, expressing worries that these plans could hurt global climate efforts and hinder progress in other areas.

Kusdiana, Indonesia’s Secretary General of the Ministry of Energy and Mineral Resources, explained that the coal-based power facilities are just one part of a larger discussion among the partners. This discussion includes figuring out how to expand the power grid and manage finances effectively.

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