Between Low Renewable Energy Target and High Economic Growth Ambitions

Jakarta, 20 February 2024 – Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR) assesses the steps taken by the National Energy Council (DEN) to adjust the renewable energy mix target in the Draft of Government Regulation on National Energy Policy (RPP KEN)  from the original 23 percent to 17-19 percent 2030 is a backward step because it is not in line with the stated goal of reducing emissions and achieving Indonesia’s net-zero emissions target by 2060 or sooner.

Fabby also highlighted the energy transition agenda carried by each pair of presidential candidates in the 2024 election, which includes a number of renewable energy mix targets until 2030 in an interview with the Squawk Box program.

According to him, each candidate has an energy transition agenda, one of which is the desire to pursue the same renewable energy mix target as the current National Energy Policy, ranging from 27-30 percent by 2030. Apart from that, each candidate also has a commitment to limit the operation of coal power plants.

“For candidate number 02, what is clearly visible is the increase in the use of biofuel to replace or reduce fuel subsidies as stated during the campaign,” said Fabby. They (presidential and vice-presidential candidates’ number two) are targeting a biofuel blend percentage of 50 percent by 2029, as well as ethanol utilization of 10-20 percent.

Furthermore, Fabby emphasized that for the electricity sector, the aim of ending coal plant operations early must be accompanied by adding a larger portion of renewable energy. Apart from replacing the electrical power that was initially supplied by coal-fired power plants, renewable energy generation must also meet the projected electricity growth needs in the future. Moreover, Indonesia has the ambition to pursue economic growth of up to, for example, 6-7 percent, so electricity demand is projected to grow even greater.

“Based on IESR’s calculations, to achieve these various targets, the renewable energy mix in 2030 must reach 40 percent, this is somewhat different from the target adjustments made by DEN currently,” explained Fabby.

Fabby added that the new government’s homework related to the energy sector will be to accelerate the development of renewable energy, especially in the electricity and liquid fuel sub-sectors.

Industrial Decarbonization: Indonesia’s Strategy to Reduce Emissions in 5 Key Sectors

Jakarta, February 15, 2024 – Indonesia, as the largest economic power in Southeast Asia and one of the most populous countries in the world, has a major challenge in reducing greenhouse gas (GHG) emissions from the industrial sector. With a rapidly growing economy, mainly driven by a young workforce, abundant natural resources, and rapid technological advancements, measures to decarbonize industry are crucial in maintaining environmental balance and sustainable economic growth.

Deon Arinaldo, Program Manager of Energy Transformation, Institute for Essential Services Reform (IESR) explained, based on the Climate Action Tracker (CAT) report, Indonesia’s current ranking is critically insufficient to limit the earth’s temperature below 1.5°Celsius. This position is down compared to 2022, which placed Indonesia in the highly insufficient ranking.

“In fact, Indonesia has set an Enhanced-Nationally Determined Contribution (ENDC) containing an increase in carbon emission reduction targets from 29% or 835 million tons of CO2 to 32% or 912 million tons of CO2 by 2030. Reflecting on the ENDC target and CAT status, Indonesia needs to push to strengthen its commitment to achieve net-zero emission (NZE) by 2060 or sooner,” said Deon during the launch of an IESR study in collaboration with Lawrence Berkeley National Laboratory (LBNL), titled “Industry Decarbonization Roadmap for Indonesia: Opportunities and Challenges to Net-Zero Emissions”. 

Farid Wijaya, Senior Analyst, IESR, explained that the total contribution of GHG emissions from the industrial sector is expected to double from 2011 to 2022, reaching more than 400 million tons of CO2e. Around 60-70% of these emissions come from energy use in the industrial sector (both heat and electricity), mainly due to fossil fuel consumption.

“Based on the IETO 2024 study, GHG emissions from the industrial sector are expected to reach 430 MtCO2e in 2022, a 30% increase from the previous year. This increase in the share of energy combustion indicates the growth of industrial processes that require high heat energy. Unfortunately, the need for these processes causes an increase in coal consumption which contributes to emissions of 174 MtCO2e,” said Farid.

Farid said that industry contributes to economic growth, therefore, decarbonization efforts need to be made to accommodate this growth. This study takes five major industrial sectors that need to be focused on decarbonization on social, economic, and emission parameters, namely cement, iron and steel, textiles, pulp and paper, and ammonia.

“Industrial decarbonization efforts can actually be encouraged in Indonesia based on the existing regulatory framework. However, the government needs to be encouraged to include stronger and more binding regulations in the future, including support and incentives for industry and ensuring that producers, consumers and markets are protected by product controls that support industrial decarbonization,” Farid said. 

According to Farid, for industrial decarbonization to be achieved in Indonesia, many stakeholders need to work together, especially to build a green industrial ecosystem that supports the NZE concept. In addition, several general strategies need to be implemented to achieve industrial decarbonization. First, implementing an ISO 50001:2018 energy management system. Second, the utilization of alternative fuels, such as biomass and hydrogen. Third, the utilization of renewable energy such as solar power and hydropower.

“Fourth, maximize energy efficiency, materials, and process optimization and use highly efficient equipment. Fifth, regular monitoring and measurement of emission process control. Sixth, utilizing carbon emission capture and storage technology (CCS/CCUS) for the cement, iron & steel, and ammonia industries,” Farid said. 

Not only general strategies, Indonesia also needs to implement specific strategies based on the five major industries. For example, for the cement industry, it needs to replace clinker and use alternative raw materials, promote hydraulic cement standards with lower clinker factors, and distribute cement using trains as an alternative to trucks.


“Based on our survey results, the five major industries in the cement, iron and steel, textile, pulp and paper, and ammonia sectors have high motivation to decarbonize.  However, costs, competitive value, and regulatory obligations for businesses and consumers still face challenges and obstacles that must be resolved together,” Farid explained.

South Sumatra Journalists Form Energy Transition Journalist Network

press release

Palembang, February 20, 2024 – The Alliance of Independent Journalists (AJI) Palembang together with the Institute for Essential Services Reform (IESR), a leading think tank in Indonesia that focuses on energy and the environment and the Society of Indonesian Environmental Journalists (SIEJ) took the initiative to form the “South Sumatra (South Sumatra) Just Journalist Network” to build public awareness of the energy transition through quality journalistic work.  Through this Just Journalist network, it is hoped that there will be more quality news related to the issue of energy transition so as to increase public understanding and trigger the acceleration of the transition from fossil energy to renewable energy at the regional level.

Based on data in the report “Insights on energy transition news in the electricity sector in Indonesia from 2020-2022” published by CASE Indonesia in 2023, national media dominated the news about energy transition in the electricity sector. Meanwhile, regional media has yet to make a significant contribution. IESR views that optimizing the role of media in the regions is crucial to reach public participation in supporting the energy transition process and greater use of renewable energy.

Chairman of AJI Palembang, M. Fajar Wiko, said that journalists who are members of the South Sumatra Just Journalist Network can shape public opinion on energy transition, identify challenges and opportunities in covering complex issues related to renewable energy, and identify the economic, social and environmental impacts of the energy transition program effectively to communicate to the public.

“The establishment of this Network is expected to clarify the role of the media in providing explanations about renewable technologies, government policies, and private sector initiatives in the energy transition, as well as encouraging better public understanding to actively participate in supporting the energy transition, and encouraging the role of stakeholders to create a more favorable environment for renewable energy, to motivate collaboration between the media, government, private sector and society to design the best solution,” said Wiko. 

Forum Jurnalis Sumsel

Marlistya Citraningrum, the Program Manager of Sustainable Energy Access, IESR, mentioned that the energy transition is happening in various parts of the world, including Indonesia has diverse contexts at the regional or subnational level. The shift from fossil fuel to renewable and more sustainable energy systems is demonstrated by the trend of retiring and early retirement of coal-fired power plants around the world – as well as in Indonesia under the Just Energy Transition Partnership (JETP) plan. This will have a direct impact on Indonesia’s coal-producing provinces and districts, particularly in the economic and development sectors. Subnational governments need to anticipate this trend in advance, including to boost the alternative economy sector and optimize the use of renewable energy. The media can play a role in educating the public to immediately switch to low-emission energy.

“IESR’s studies in several coal-producing regions show that although regional income depends on the coal economy, the economic multiplier effect is not directly enjoyed by surrounding communities in the form of infrastructure, economic improvement, or basic services such as education and health. In Muara Enim, around 78% of profits are absorbed by mining companies, in addition to local laborers working more freelance for contractors or vendors of mining companies instead of professional workers in the company,” said Marlistya.

Aryansyah, Head of Energy Division, Energy and Mineral Resources Agency of South Sumatra Province, said that the province has a renewable energy potential of around 21,032 MW with an installed capacity of renewable energy of around 989.12 MW or around 4.70%.

“In the future, the utilization of clean energy based on renewable energy in South Sumatra can be further developed to all levels of society. Some of the strategies we carry out to encourage the use of renewable energy, including providing energy for regional needs by increasing exploration of the potential for new renewable energy, utilizing new renewable energy such as solar energy, water, geothermal and others, as well as conserving and diversifying energy,” said Aryansyah.