Request for Proposal (RFP) Strategic Communication and Advocacy Plan in Promoting Low Carbon Solutions Adoption for Indonesia’s Large Industries & Small-Medium Industries

Background

Achieving the national economic development targets in 2045 would drive capacity expansion in several key industries in Indonesia, such as iron and steel, cement, ammonia, pulp and paper, and textile industries. According to the latest IESR study, the five industries are responsible for about one-third of the national industry emissions in 2020 or about 102 MtCO2. This is because many of those industry players use outdated production technologies that work inefficiently and consume fossil fuels either as feedstock or fuel sources. In other cases, the industry plan its capacity expansion utilizing the carbon-intensive technology which could create emission lock-in for decades to come. Also, the currently low adoption of sustainable raw feedstock materials in cement, iron and steel, and papermaking industries drive the emissions to increase its emission by an additional 50 MtCO2 per year by 2050, and collectively with other industry subsectors, will increase the sector emissions to double in the same year.

Other than that, with the industry and commercial sectors’ landscape in Indonesia are dominated by smaller businesses of about 99%, it is also imperative to consider these smaller businesses’ role in Indonesia’s emissions portfolio. From the IESR study, it has been revealed that with the number of MSMEs reaching 65 million businesses in 2021, the least approximation of total estimated energy-related emissions could reach up to 216 MtCO2 per year in 2023, or about half of the industry sector’s emissions, including emissions generated from burning fuel, industry processes, and waste. Such high CO2 emissions are caused largely due to the very low understanding of MSME actors on how to implement energy efficiency measures as well as the lack of financial and technical capacities to tap into renewable fuel and electricity to support their businesses.

Understanding the timely urgency of decarbonizing industries of all sizes, Institute for Essential Services Reform (IESR) intends to formulate a strategic communication and advocacy plan to increase public awareness on the topic and drive the industry’s transformational change and increase the adoption of lower carbon technology and sustainable practices among large industries and SMEs. It is expected that the consultant develops the communication and advocacy plan following the Specific, Measurable, Achievable, Relevant, and Time-Bound (SMART) principle with at least a one-year timeframe. The successful consultant will provide input on methods, content, and implementation strategies. The strategy must include the use of online tools and new media outlets, including IESR’s existing social media accounts and website.

Requirement

  1. Proposal
  2. Mandatory required documents
    • Statement Letter of Compliance with Pre-Qualification Provisions
    • Statement Letter of Not Involvement in Probitied Organizations
    • Statement Letter of Not Claiming Compensation
    • Business Entity Qualification Form
    • Statement Letter Not Under Court Supervision
    • Expression of Interest
    • Statement of Willingness to Deploy Personnel and Equipment
    • Statement of Overall Commitment
    • Field Capability Statement Letter
    • Statement of Authenticity of the Document
    • Integrity Pact

All required documents can be downloaded through this link (s.id/documentsrfpcommsiesr), and expected to be received to IESR until 10:00 p.m. Indonesian Western Standard Time (WIB, GMT+0700) on Friday, 19 April 2024. Any proposals received after this date and time will be regarded as inadmissible. All proposals must be signed by an expert, official agent, or company representative submitting the proposal.

Proposals will be accepted until 10:00 p.m. Indonesian Western Standard Time (WIB, GMT+0700) on Friday, 19 April 2024. Kindly address the Program Manager Energy Transformation IESR at deon@iesr.or.id and the Coordinator of Industrial Decarbonization Project at faricha@iesr.or.id for inquiries. 

For more detail :

RFP-IESR-Strategic-Communication-and-Advocacy-Plan-in-Promoting-Low-Carbon-Solutions-Adoption-for-Indonesias-Large-and-Small-Medium-Industries.docx-1

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Renewable Energy Must Reign Supreme in Southeast Asia

Jakarta, March 27, 2024-Southeast Asia is a world’s fifth-largest economy region in 2022. However, this economic growth comes with a concerning projection: greenhouse gas (GHG) emissions in the region are expected to soar by 60 percent by 2050. Curbing these emissions is pivotal for global efforts to combat climate change. Unfortunately, current endeavors to promote renewable energy in Southeast Asia fall short of aligning with the Paris Agreement, which aims to limit global warming to below 1.5 degrees Celsius.

Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), stated at the Revision 2024 International Conference in Tokyo (14/3) that ASEAN countries have set a target to achieve a renewable energy mix of 23 percent by 2025. However, he emphasized that this target doesn’t align with the Paris Agreement’s objectives.

“To align with the Paris Agreement, the renewable energy mix needs to account for 55 percent, with variable renewable energy (VRE) contributing 42 percent. Except for Vietnam, Cambodia, and the Philippines, others have yet to reach 5 percent VRE penetration. The good news is that in 2023, ASEAN countries will have over 28 GW of operating utility solar and wind capacity, a 20 percent increase in operating capacity since last year. Currently, they make up 9 percent of ASEAN countries’ total electricity capacity. But in order for ASEAN countries to meet the goal, they need to install more renewable energy,” Fabby remarked.

Fabby further highlighted the relatively abundant renewable energy resources in Southeast Asia, which are estimated to be 40-50 times greater than the region’s current energy needs. He suggested that utilizing floating solar power plants could be a strategic move towards decarbonizing the energy system. He elaborated on the technical potential, with reservoirs boasting 134 to 278 GW and natural water surfaces such as rivers, lakes, and seas holding 343 to 768 GW. However, he stressed the importance of conducting detailed calculations of the technical, market, and economic potential, as well as site-specific assessments to develop floating solar power plants.

Additionally, he highlighted the need for Southeast Asian countries to adopt more ambitious policies, provide robust budget support and incentives, and enact policies that attract investment. The average annual investment in renewable energy capacity should be increased by five times to USD 73 billion per year.

Fabby emphasized that Southeast Asian countries must elevate their ambitions to meet the Paris Agreement targets. As an immediate step, ASEAN should aim for a 23 percent renewable energy mix by 2025 and 40 percent by 2030.

“Various studies have shown that decarbonizing the energy system with renewable energy in Southeast Asia is feasible; however, current policies and actions are insufficient to achieve significant decarbonization by 2050. While renewable energy resources are abundant and ample, substantial investment is needed. Each country must reform policies and manage risks associated with renewable energy projects to attract and mobilize investors further,” Fabby added.

He also cautioned against perpetuating a narrative that prioritizes fossil energy as a baseload generator under the guise of maintaining energy security, while sidelining renewable energy. Such a narrative, he argued, is counterproductive and contradicts the spirit of the Paris Agreement.

Launch of Indonesia’s Climate Action Tracker Assessment Report and Climate Transparency Implementation Checkup

“State of Indonesia’s Climate Policy 2023: Expectations for Increased Ambition and Strengthened Implementation to Achieve the Paris Agreement Targets by 2030”

Replay Event

Background

The year 2023 was recorded as one of the hottest years on record, with global temperatures rising by 1.4 degrees Celsius since the pre-industrial era. In the first global stocktake carried out during the COP-28 Dubai event, the United Arab Emirates also stated that policies and actions taken by countries in the world are still unable to reduce the rate of increase in emissions in line with the Paris Agreement targets. The Global Stocktake results show that based on the current accumulation of Nationally Determined Contributions (NDCs), there are still around 20.3–23.9 GtCOe2 emissions that need to be reduced to prevent a temperature rise above 1.5C by 2030. Thus, more ambitious climate policies and actions at the national level play an important role in the global effort to achieve the Paris Agreement targets.

In the context of climate policy in Indonesia, data from the Climate Action Tracker (CAT) as of December 2023 shows that Indonesia still needs to reduce around 800 MtCOe2 in 2030 emissions to align its emission reduction target with the Paris Agreement (CAT, 2023). The operationalization of new coal power plants as well as the quantification of emissions from off-grid generation caused Indonesia’s emissions to rise by around 21% in 2022 (CAT, 2023). This results in Indonesia’s emissions being projected to increase by around 300 MtCO2 by 2030. Based on CAT’s assessment, Indonesia needs to increase the percentage of the renewable energy mix by around 55%–80% by 2030. Therefore, Indonesia needs to re-evaluate the climate targets contained in its NDC and also improve coordination between sectors in order to accelerate the achievement of the Paris Agreement targets.

Indonesia will experience a change of government in 2024. With this change, there is a possibility that the policy direction of the new government will be different from the previous government. It is hoped that the new government will be able to formulate a more ambitious and comprehensive climate policy umbrella so that it can support the achievement of the Paris Agreement targets and remain in line with the country’s development plan. Publication of Climate Action Tracker Country Assessment: Indonesia and Climate Transparency Implementation Check The report is expected to be a reference for recommendations for policymakers in order to harmonize climate policies at the national level and also commitments at the global level. In addition, the dissemination of these two reports is also expected to open a discussion space for the public to provide feedback and recommendations on climate policy in Indonesia.

Objective 

  1. Dissemination of the Climate Action Tracker report: Indonesia Climate Action Status 2023 to stakeholders and the general public;
  2. Facilitate discussions on the implementation of climate policies in the electricity, financing, and AFOLU sectors;
  3. Become a cross-sector discussion space for the government as a policy maker, civil society organizations, academics, and the general public in order to realize climate policy and energy transition in Indonesia in line with the Paris Agreement targets;
  4. A means of gathering opinions and inputs from various levels of society and sectors, which can be used as recommendations for climate and energy transition policies in Indonesia.

Presentation

 

Status of Indonesia’s Climate Action and Policy 2023- Delima Ramadhani

Status-Aksi-dan-Kebijakan-Iklim-Indonesia-2023-Delima-Ramadhani

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Renewable Energy Development in Indonesia Power Sector – Akbar Bagaskara

Renewable-Energy-Development-in-Indonesia-Power-Sector-Akbar-Bagaskara

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Increasing AFOLU Sector Climate Ambition Towards Net Sink 2030 – Yosi Amelia

Peningkatan-Ambisi-Iklim-Sektor-AFOLU-Menuju-Net-Sink-2030-Yosi-Amelia

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Landscape of Climate-Aligned Investment in Indonesia Financial Sector – Luthfyana Larasati

Landscape-of-Climate-Aligned-Investment-in-Indonesia-Financial-Sector-Luthfyana-Larasati

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Exchanging Insights on Local Solar Manufacturer in Indonesia and Viet Nam

Ha Noi, 14 December 2023 – The Ministry of Science and Technology of Viet Nam hosted its annual event: Technology and Energy Forum 2023, in collaboration with the Ministry of Industry and Trade and Project Clean, Affordable and Secure Energy for Southeast Asia in Viet Nam.In recent years, Viet Nam has witnessed remarkable development in the trends of energy transition, particularly in wind and solar power. By the end of 2022, the total capacity from wind and solar power had reached 20,165 MW, constituting 25.4% of the overall power capacity within the system.

However, despite this progress, 90% of equipment for renewable energy projects in Viet Nam is imported from countries like China, Germany, India, and the US. This reliance is due to the country’s limited ability to perform specific tasks during project assessment and development phases and its high dependence on imported technologies. Factors contributing to this situation include inadequate local technology capacity, production levels falling short of requirements, and a lack of support from industrial policies and mechanisms to encourage renewable electricity.

Consequently, Vietnamese enterprises and local supply chains have seen limited participation. Similarly, Indonesia faces comparable challenges in its procurement of renewable energy, particularly in solar power. Despite both countries boasting immense potential in solar power, their domestic markets are not yet equipped for solar manufacturing. This deficiency stems from uncertainties in local demands and the lack of competitiveness in the local supply chain.

Fabby started with an explanation about local content regulation that could minimize dependence on imported products. 

“Indonesia is currently facing domestic market issues; these local products encounter difficulties entering the market. The lack of a credible development pipeline limits financial viability for new solar modules manufacturing facilities. When it comes to Rooftop PV, PLN limits the installation capacity to 15%. This regulation further restricts the market for domestic solar modules,” state Fabby.

Fabby went on to highlight several lessons learned from implementing Local Content Regulations (LCR) in Indonesia, which could potentially accelerate the development of Viet Nam’s solar energy local content. First, despite the projected growth in solar power, there’s insufficient market signal to stimulate the growth of the solar module industry without a reliable pipeline. Second, inconsistencies in policies across government bodies might discourage investment in the solar power market due to increased uncertainty. Third, support for the domestic solar modules industry should encompass downstream raw material industries to reduce import dependency and enhance the competitiveness of end products. Lastly, governments should offer incentives, both fiscal and non-fiscal, to encourage the development of solar module manufacturing facilities. Fabby emphasized that LCR, without a conducive investment climate for the industry, might impede rather than foster the development of solar power.

Stocktaking the Climate Action in Southeast Asia

Johor Bahru, 15 November 2023 – In achieving the agenda of global energy transition, the Southeast Asia region is taking measures to climate action including its non-state actors. Meaningful participation from non-state actors is crucial in observing the currently running policies and providing input for future improvements.

Stocktaking becomes a crucial activity to track the current progress of climate mitigation and action. The results of the assessment then can be utilized to design robust policy recommendations. Non-state actors can enrich the nuance of the global stocktake  by convening and aligning climate action with the interest of the global community. 

Wira Agung Swadana, the green economy program manager at the Institute for Essentials Services Reform (IESR) highlighted the key takeaways from the first global stocktake during the Asia Pacific Climate Week 2023 in the session “Integrating the role of NSAs focused on the thematic areas–Adaptation, Finance, and Mitigation”. The imbalance in growth of global emissions compared to the climate mitigation plan leads to issues such as the urgency to have systemic transformation.

“We need more ambition in action and support during the implementation of the mitigative action in the region,” he said.

Wira added that achieving net-zero emissions requires systemic transformation across all sectors, and we need to tap into every opportunity to achieve higher output. The business and commercial sector is an important factor in accelerating energy transition as they consume massive amounts of energy. Besides, some of the industries (especially those involved in multinational-scale supply chains), have the obligation to green their business process.

“What the government can do for business (to decarbonize their operations) is to provide an enabling environment if they want to shift to more sustainable business process. For instance, the government can give incentive and disincentive based on the choice of energy resource used to power the businesses,” Wira concluded.

Jingjing Gao, from the UNEP Copenhagen Climate Centre, added that the private sector-led initiative is worth noting. Yet, there is still a gap in data incorporation from the private sector.

Reflection on Indonesian Leadership in ASEAN 2023

Jakarta, 20 October 2023 – The transfer of the ASEAN leadership baton to Laos marks the end of Indonesia’s leadership in the ASEAN region. A number of milestones such as cooperation with external non-ASEAN parties, as well as several opportunities for cooperation between ASEAN member countries are a good note. However, this good record has not been matched by an increasing commitment to curbing the rate of climate change, the impacts of which are increasingly being felt.

In a Public Discussion entitled “Reflecting on Indonesia’s Leadership in ASEAN 2023: Towards a Regional Frontrunner in Climate and Energy Transition Issues”, Wira Agung Swadana, Green Economy Program Manager of the Institute for Essential Services Reform (IESR), stated that during Indonesia’s leadership period, cooperation or action was agreed upon by ASEAN member countries are still mainly infrastructural.

“The results of the 2023 ASEAN Summit and other energy and climate-related meetings can be seen that there is still a lack of focus on renewable energy issues. “For example, there is no joint commitment to increase the development of a cleaner solar energy or hydropower ecosystem,” said Wira.

Apart from the ecosystem for renewable energy, Wira also said that several issues had ‘eluded’ the attention of ASEAN high-ranking officials, such as the issue of critical minerals and low-carbon and sustainable electric transportation.

Executive Director of the Indonesia Research Institute for Decarbonization (IRID), Moekti Handajani (Kuki) Soejachmoen, explained the phenomenon of the high contribution of emissions from the energy sector in ASEAN countries.

“Energy is an engine for development, so if development still uses energy procurement patterns with a business-as-usual scheme (high fossil-ed), emissions will definitely increase significantly. On the one hand, all ASEAN member countries need to carry out development but must control their emissions,” explained Kuki.

Kuki then added that the role of technology is needed to enable development to continue and keep the amount of emissions released low. The use of this technology will have financial consequences.

By looking at this problem, Kuki emphasized that it is important for ASEAN as a regional unit to develop a comprehensive strategy to achieve the NDC targets for each country and encourage the achievement of Net Zero Emissions. From this strategy, mitigation actions can be grouped that can be carried out alone, those that require international financial support, those whose emission reduction units can be sold and those that require additional purchase of emission reduction units.

IESR Energy and Climate Diplomacy Coordinator, Arief Rosadi, highlighted ASEAN’s tendency to seem slow in taking strategic diplomatic positions, thus creating various gaps such as institutional gaps, ambition gaps, implementation gaps and participation gaps. According to him, Indonesia can use its position to strengthen its climate and energy diplomacy and contribute to narrowing gaps in ASEAN.

“Increasing climate ambition in strengthening Indonesia’s climate and energy diplomacy strategy is a modality for Indonesia to encourage the same thing in other countries at regional, bilateral and multilateral levels. Apart from that, fixing the gap can be done by encouraging the resolution of the gap at the regional level in ASEAN’s internal processes,” added Arief.

Indonesia Can Push the Energy Transition Agenda during Laos’ Chairmanship of ASEAN in 2024

Jakarta, October 20, 2023 – Indonesia, as the chair of the Association of Southeast Asian Nations (ASEAN) in 2023, has achieved significant progress in climate and energy transition issues, including the launch of ASEAN Taxonomy for Sustainable Finance (ATSF) Version 2 and the ASEAN Carbon Neutrality Strategy. The Institute for Essential Services Reform (IESR) appreciates this progress. However, IESR believes that after its leadership in ASEAN, Indonesia must consistently prioritize the development of renewable energy over untested technologies like carbon capture storage (CCS) to ensure the implementation of low-carbon ideas. IESR also suggests that Indonesia should push for the energy transition agenda to be a priority during Laos’ chairmanship in 2024. 

Besides, Indonesia must reduce emissions by demonstrating a stronger commitment and implementing effective strategies. Indonesia’s Nationally Determined Contribution (NDC) target ranking, as evaluated by the Climate Action Tracker (CAT) in 2022, is still ‘Very Inadequate’. Some causes of Indonesia’s low ranking include the energy sector’s inconsistent strategies. According to the 2021-2023 RUPTL, the percentage of coal mix increases from 62% in 2025 to 64% in 2030. Furthermore, Indonesia’s government is working on a regulatory framework for carbon capture and storage technology (Carbon Capture Storage CCS/Carbon Capture Utilization Storage CCUS) to establish Indonesia as a CCS hub in Southeast Asia.

Wira Swadana, Program Manager of Green Economy IESR,  mentioned that many issues related to climate and energy diplomacy in ASEAN still do not touch the community, even though climate actions directly impact the community. The outcome of Indonesia’s chairmanship of ASEAN 2023 shows some improvement in climate and energy ambition and implementation. However, Indonesia’s focus on developing untested infrastructure, such as CCUS and the Electric Vehicles (EV) ecosystem, remains, neglecting the principles of sustainable mobility.

“Indonesia and other ASEAN countries should focus on more decisive actions and cooperation such as building a renewable energy development ecosystem, focusing on equitable and responsible practices for the development of transition/critical minerals,” he said in the public discussion “Reflection on Indonesia’s Leadership in ASEAN 2023: Towards a Regional Front-runner in Climate and Energy Transition Issues”.

Arief Rosadi, Project Coordinator of Climate Diplomacy IESR, explained that besides Indonesia, four other ASEAN Member States (AMS), such as the Philippines, Singapore, Thailand, and Vietnam, have inadequate climate ambition based on CAT. Therefore, ASEAN countries need to increase their climate ambition by significantly reducing emissions in the energy sector, and this should be reflected in the upcoming regional energy planning document (ASEAN Plan of Action for Energy Cooperation, APAEC).

“Four gaps require attention in ASEAN’s approach to energy and climate issues. These gaps are institutional, ambition, implementation, and participation gaps. First, the institutional gap in ASEAN’s approach can be seen in the fragmented regulation of energy and climate issues. Energy issues are under the ASEAN economic pillar, while climate issues are under the ASEAN socio-cultural pillar, which creates a lack of coherence. ASEAN must comprehensively map out institutional roles and responsibilities to address this issue. This will ensure that policy implementation at national and regional levels is effective and efficient,” Arief said.

Arief continued that the second gap concerns the lack of alignment with the Paris Agreement regarding climate ambitions. Third, political and technical factors still constrain the energy transition implementation gap by giving space to untested technologies such as CCS. Fourth, there is a limited participation of civil society in these efforts. Addressing these four gaps will be crucial for ASEAN to achieve its goals.

“Indonesia plays a crucial role in ASEAN due to its position as the largest economy and significant political influence. It can use its influence to promote the energy transition agenda as a key discussion during Laos’ chairmanship of ASEAN in 2024,” Arief said.

IESR encourages Indonesia to strengthen its climate diplomacy strategy by conducting a comprehensive synchronization of various multilateral forums to produce tangible results and cooperation regarding technical, clean energy investment or funding mobilization for Indonesia and ASEAN.

On the other hand, Indonesia and other ASEAN countries need to consider the development of a Carbon Economy (NEK/Carbon Pricing) to achieve their climate goals. To ensure effective NEK implementation, Indonesia needs to identify the target NEK segmentations from the existing NEK instruments, determine the lowest cost NEK instrument, establish a carbon tax, and create a roadmap for Nationally Determined Contributions (NDC) and Net Zero Emissions (NZE) that is in line with NEK.

“Domestic carbon pricing instruments can be quite helpful to achieve the NDC and NZE targets. However, these pricing instruments should be applied to mitigation actions that are relatively no cost or low cost not to overburden domestic finances. Even though a carbon tax will help reduce greenhouse gas (GHG) emissions, it is not easy to calculate the exact reduction in GHG emissions. Therefore,  the revenue generated from carbon tax should be allocated towards climate mitigation and adaptation actions so that the benefits of a carbon tax can directly impact climate action,” said Moekti Handajani Soejachmoen, Executive Director of Indonesia Research Institute for Decarbonization.

CNBC | ASEAN Will Shine Brightly in 2040

The comparison of the number of electrified household customers with the total number of households, known as the electrification ratio, especially in the Association of Southeast Asian Nations (ASEAN), has experienced a significant increase in recent years.

Baca selengkapnya di CNBC.

Indonesia Needs to Synergize Policy and Strategies to Accelerate Energy Transition

press release

Bali, August 29, 2023 –  Institute for Essential Services Reform (IESR) alongside the Energy Transition Policy Development Forum (ETP) hosted a discussion to bridge the gap between policy and practices in accelerating energy transition in Indonesia. This discussion was a side event at the ASEAN Energy Business Forum 2023, held on Friday (25/08).

Business representatives were from Quantum Power Asia, Suncable, PT TML Energy and the Indonesian Biofuel Producers Association. The policymakers included the Ministry of Investment/BKPM, Vice Ministry of Finance, Coordinating Minister of Maritime Affairs and Investments; The Regional Government of Bali  and Perusahaan Listrik Negara. 

Both businesses and policymakers representatives shared their challenges, expectations, plans, and collaborative strategies to make energy transition work in Indonesia. An underlying challenge faced with both stakeholders is financing. On one side, businesses face a lack of incentives while generating renewable energy projects and subsidies make it harder for renewables to compete with conventional energy sources. On the contrary, policymakers need investment to be able to generate projects. 

In its report titled “Indonesia Sustainable Finance Outlook (ISFO) 2023”, IESR observed that there are significant investment risks associated with renewable energy due to unattractive tariffs. The tariffs contribute to lower private investor confidence in renewable energy projects. Furthermore, the lack of transparency in the procurement process for renewable energy projects highlights the necessity for improving the investment environment and the bankability of renewable energy projects. This improvement would lead to increased confidence among private investors and greater trust from international funders.

Businesses are keen to support the development of renewable energy in Indonesia. However,regulations need to be settled first to shorten the negotiations process between government and private sectors. Furthermore, aligning the energy transition agenda between government bodies, harmonizing regional and national policies, and interconnectivity are the key points of the discussion between the two stakeholders.

Fabby Tumiwa, the Executive Director of Institute for Essential Services Reform, encourages the Indonesian government to learn from policies and best practices from other countries to accelerate energy transition. Although these said policies and strategies need to be adapted as “Indonesian-style” (the solutions should be based on national wisdom and situation) policies and practices to accommodate the complexity of the Indonesian energy sector.

“Indonesia needs an energy ecosystem to enable investment and partnerships. We need to be perceptive, we need innovations and a different approach from Perusahaan Listrik Negara (PLN) to boost energy transition. PLN needs to prepare for the ecosystem and it has to be supported by policies from the Ministry of Energy and Mineral Resources to foster public and private financing. Although there are different expectations from businesses and policymakers, we have to keep moving forward, despite our limitations,” stated Fabby.