Indonesia could achieve net zero greenhouse gas emissions by 2055 or earlier instead of 2060 with more international cooperation and technological development, a senior Indonesian official said.
Indonesia's Maritime Affairs and Investment Coordinating Minister Luhut Panjaitan said the country has enough renewable energy resources that can be unlocked through joint financing shared between public and private investors.
“Our first goal was [net zero] by 2070, then we found that with technology and international support we could [move] the goal to 2060. Why not": Luhut said at the Ecosperity Week climate conference in Singapore.
Indonesia is the world's fourth most populous country, with about 280 million people, and relies heavily on cheap but polluting coal for its economic growth.
In late 2022, he signed the $20 billion Just Energy Transition Partnership (JETP) with several wealthy foreign countries and private donors to shut down coal plants early and increase renewable energy to a third of total electricity generation by 2030. In 2050
However, Luhut has also publicly stated in recent weeks that based on discussions with stakeholders, it is unclear how the pledged funds will be disbursed and whether the loan interest rate will be low enough. He reiterated on Tuesday (June 6) that JETP should not stop the development of the national economy.
Speaking at Ecosparity, Luhut noted that Indonesia's per capita emissions are 2.3 tons per year, lower than the global average of about 4.5 tons and more than 14 tons in the United States. According to Climate Action Tracker, the figure provided by Luhut does not include emissions from land-use changes such as deforestation, which, while slowing in recent years, accounted for about half of the country's total emissions over the past two years. Data platform.
"We have the right to go up to 4.5 [tons] before [reducing emissions]," he said, adding that Indonesia also has the right to become a high-income country one day.
Indonesia will present an energy transition plan to its JETP sponsors in August. Luhut said the government is preparing detailed information and plans to use natural solutions and carbon sequestration technologies in addition to energy production, transportation and industrial activities.
Luhut said the administration has identified 4.7 GW of coal capacity in phases in the capital Jakarta and the neighboring island of Sumatra.
The Indonesian government said last year it had identified a total of 32 coal-fired power units with a capacity of 16.8 gigawatts for its first retirement, Singapore's The Straits Times reported. Last year, Indonesia also signed an agreement with the Asian Development Bank to shut down a 600 megawatt coal-fired power plant 15 years ahead of schedule.
Luhut said any loans to develop clean energy to replace coal-fired power plants would need to include subsidies to bring electricity prices in line with current coal-fired electricity prices of just 3 cents per kilowatt-hour. According to his calculations, the initial price of renewable electricity could be 9 cents per kilowatt hour.
Indonesia, the largest emitter of greenhouse gases in Southeast Asia, may not be able to meet its national climate goals, which include reaching zero by 2060 . investment firm Zenjiro and tech giant Amazon Web Services.
Despite growing green investment flows into Indonesia, the country still subsidizes fossil fuels and has no firm plans to green its power grid, the report said. Indonesia has also moved away from the zero-deforestation pledge it made in 2021, he noted.
However, Luhut is optimistic about Indonesia's renewable energy potential of more than 400 GW, more than five times the current installed capacity.
"You talk about solar panels, we talk about wind, we talk about hydropower, geothermal energy. We have everything, but I don't think we can do it alone," he said.
