ASEAN Grid Interconnectivity as the Start of Renewable Energy Security in the Region

press release

Jakarta, 13 June 2023 –  To reach energy security sustainably and to face challenges of global climate change, Indonesia’s chairmanship in 2023 needs to be a strong leader in the decarbonization efforts of the energy sector in Southeast Asia. region. Institute for Essential Services Reform (IESR) views that Indonesia can further its regional cooperation and collaboration on innovation, technology, renewable energy research, and push for clearer and enticing policies to boost investments in the renewable energy sector.

As a region, ASEAN has committed to reach a 23% energy mix target in primary energy and 35% capacity of renewable energy installed by 2025. Furthermore, to expand the regional electricity trade , integrate the region’s power grid, and to strengthen the reliability of the power grid, ASEAN is currently building the ASEAN Power Grid (APG).

The Executive Director of the Institute for Essential Services Reform (IESR), Fabby Tumiwa, explains that the project to interconnect ASEAN’s grid through ASEAN Power Grid (APG) could be a starting point for ASEAN member states to boost renewable energy capacity in the electricity sector and shift their dependency to fossil fuels. Indonesian chairmanship in ASEAN 2023 with one of its main focus being Sustainable Energy Security has to be utilized to push ASEAN member states to focus on efforts to decarbonize their energy systems. 

“Indonesia has the chance to lead ASEAN to transition their energy, amplifying the renewable energy mix, and to reduce fossil energy. Indonesia has given examples for other ASEAN member states to have a more ambitious target that aligns with the Paris Agreement. One of which is to push ASEAN member states to end CFPP operations before 2050 and to push agreements between ASEAN member states to build cell industries, solar modules, and energy storage (battery),” Fabby Tumiwa assessed. 

ASEAN itself has a capacity of 7.645 MW on the existing interconnecting grid in the ASEAN Power Grid project, according to a presentation from the Sub Coordinator of the Electricity Program MEMR, Yeni Gusrini, in the IESR Webinar titled Toward a Decarbonized ASEAN. In the future, the interconnection grid will be added in capacity to around 19.000 – 22.000 MW and covers a wider area.

“ASEAN Power Grid contributes towards the economic development in ASEAN by helping fulfill energy demand in ASEAN and to develop regional industry player’s growth. On the first phase, the electricity grid in Laos, Thailand, Malaysia, and Singapore has been connected through the Lao PDR, Thailand, Malaysia, Singapore Power Integration Project (LTMS-PIP), which has been the pioneer of the power trade mechanism that has transmitted 100 MW from Laos to Singapore, utilizing the existing interconnection,” Yeni explicated. 

IESR views that the development of an interconnection grid that accommodates the integration of renewable energy in Indonesia needs to be accelerated so that it aligns with the Paris Agreement to net zero emission (NZE) in 2050.

“Interconnection between the islands in Indonesia and between the countries in ASEAN is one of the enabling factors of renewable energy integration. The existence of this interconnection will help solve the problem of intermittency and to maximize renewable energy usage, so that if there’s an oversupply such as solar PV in the daylight built in another location, the electricity can be transmitted to another place. Before that, ASEAN member states have to keep refurbishing their renewable energy investment climate in their respective countries and regionally with a more interesting regulation framework,” explained Deon Arinaldo, Program Manager of Energy Transformation IESR. 

Deon says, Indonesia is a country with the biggest economy and energy consumption rates in ASEAN, and has a massive energy resource. With ASEAN chairmanship this year and a supportive process and regulations for energy transition at the national level such as JETP and New and Renewable Energy Bill, this will make Indonesia an example and trigger the acceleration of ASEAN’s transformation process.

IESR believes that the decarbonization efforts are not limited to the government, but also involves the participation of various stakeholders, including private sectors, civil society, and international agencies. In this spirit of collaboration, Indonesia needs to invite all parties to join in the effort to tackle climate change and create a sustainable future for ASEAN. 

Enlit Asia : Strengthening ASEAN Readiness in Energy Transition

Background

The energy transition has different characteristics in every region, yet the overarching story is the same: how we harness, trade, deploy and use energy is changing radically and rapidly.​ As the largest country in ASEAN, Indonesia accounts for around two fifths of the region’s energy consumption. Energy demand across the country’s more than 17,000 islands could increase by four fifths and electricity demand couple triple between 2015 and 2030. To meet this demand, Indonesia is not only shifting reliance on domestic coal and imported petroleum, but also adding more renewables to its energy mix.

The country has set out to achieve 23% renewable energy use by 2025, and 31% by 2050.​ Harnessing its renewables potential is expected to require over USD 16 billion of investment per year over the period to 2030.

The Institute for Essential Services Reform (IESR) is participating as a supporting association in the Enlit Asia 2023 event in Indonesia.

 

Objectives

  • Meeting growing electricity demand by capturing renewable energy resource​
  • Developing renewables for industry, buildings and transport​.
  • An integrated and comprehensive bioenergy programme and ensuring sustainable development and use of this vital energy source.

Pushing the Role of Civil Society Organizations in ASEAN Transformation

Jakarta, 16 Mei 2023 – Indonesia’s role in international diplomacy continued after successfully hosting the G20 meeting in November 2022. This year, Indonesia holds the ASEAN chairmanship. ASEAN itself is an important region as it accounts for the biggest economic growth. In terms of economic growth, ASEAN will have 4,3% of economic growth according to ADB. Challenges that linger around ASEAN currently are the effect of climate change and energy transition.

ASEAN countries other than Vietnam still have a high reliance on fossil fuels, especially coal in the energy system. It will take more effort as well as financing to transform the whole energy system in ASEAN into a low – carbon and sustainable one. 

Fabby Tumiwa, Executive Director at the Institute for Essential Services Reform (IESR), during the webinar titled “Making Energy Green and Low Carbon to Support Sustainable Growth” through Advancing the Role of Civil Society in Southeast Asia Energy Transition During Indonesia ASEAN Chairmanship 2023” mentioned that all stakeholders including the government and private sector need to work hand in hand to ensure that transformation toward a clean energy system is happening in ASEAN.

“We also need further collaboration at the grassroots level and the increasingly significant role of ASEAN’s CSO in the region and how ASEAN’s CSO either as an individual entity and group can contribute to “Making Energy Green and Low Carbon to Support Sustainable Growth” through Advancing the Role of Civil Society in Southeast Asia Energy Transition During Indonesia ASEAN Chairmanship 2023,” he said. 

Later on, Ridwan Budi Santoso, Investment and Electricity Cooperation Working Group Coordinator, Directorate General of Electricity MEMR explained that Indonesia ASEAN chairmanship will try to secure a deal on regional cooperation including power interconnectivity that is expected to boost the economic growth of the region. He said that his parties will have a joint declaration of 41tst Asean Ministers on Energy Meeting on sustainable energy through interconnectivity, and a joint statement for Brunei Darussalam – Indonesia – Malaysia – Philippines Power Integration Project (BIMP – PIP) as the deliverables.

“We expect the utilities (in those countries-ed) to sign the MoU for interconnectivity,” said Ridwan. 

In the policy-setting agenda, Indonesia aims to have a joint statement addressing the climate change impact in the region.

“Beside ASEAN joint statement on climate change, we will also have a study about ASEAN community-based climate action, which contains lessons learnt and best practices to be implemented at the community level,” Wisnu Murti, Directorate General of Climate Change Control, Ministry of Forest and Environment explained.

Responding to the explanation of Indonesia as ASEAN chair this year, Antony Tan, Executive Officer of the All-Party Parliamentary Group Malaysia on Sustainable Development Goals (APPGM-SDGs), highlighted that ASEAN’s presence in the international community is lacking. A little bit different from, for example, the European Union which has a special presence during international meetings.

“We see that for example, during the last COP 27. We (ASEAN) sit in a separate part and together only because of Loss and Damage,” he added.

In terms of renewable energy development in Malaysia, Antony said that currently, Malaysia focuses on solar PV and hydro. Malaysia aims to increase its renewables shares, excluding hydropower to 20% of the generation mix by 2025.

“We lifted the ban on renewable energy exports. This move is welcomed by Singapore, as it will benefit the neighboring country and boost the local renewable sector,” he concluded.

The previous ASEAN chair, Cambodia faced different challenges to bring decarbonization to the country. In overcoming the challenges, non-government organizations act as a bridge to make the vision clearer in accelerating the energy transition.

“When we talk about decarbonization, it means we need to talk about what kind of energy market reform, what enablers can be implemented, and we need to understand that the context between one place and another is quite different and we need to figure out a different approach,” explained Natharoun Ngo Son Executive Director, Energy Lab, Cambodia.

Chariya Senpong, Energy Transition Team Leader, Greenpeace Thailand highlighted the role of becoming a bridge for many stakeholders. Civil society organizations must empower people to move beyond the trans boundaries level.

“It is important to communicate the climate-related issue not only to people but also to the government, especially at the ASEAN level. On how we can get a quick policy shift to reach the net zero emissions level. CSO also needs to work in different levels of advocacy to influence and move the stakeholders to a more sustainable pathway,” she explained.

Aryanne De Ocampo, Advocacy, Networking, and Communications Officer, Center for Energy, Ecology and Development added that ASEAN is having the power to drive decarbonization globally.

“As ASEAN, we should be amongst the loudest of those who demand change from the governments and industries to commit to ambitious climate targets. For ASEAN to own up to its identity, it also needs to represent the most vulnerable parts of society, starting from its climate goals.”

Every year ASEAN puts out hundreds of joint statements and ASEAN needs to make sure that the statements related to climate change are manifested. This point is brought up by Esther Tamara, Director of the Climate Unit, Foreign Policy Community Indonesia.

“ASEAN needs to make sure that the joint statement regarding climate change does not stay only as statements. ASEAN community vision post-2025 has to be climate focused to create a green world. There are also words from the Cambodian government especially to create a Green Deal, but there has not been a lot of movement towards it,” she said.

Esther added that there should be an official mechanism for civil society organizations that allows a bottom-up discussion to happen in ASEAN.

Building Collaboration Between CSOs in ASEAN to Accelerate Energy Transition

press release

Jakarta, May 16, 2023 – As the Chair of ASEAN in 2023, Indonesia can engage civil society in enhancing ASEAN’s relevance in various aspects aligned with global development challenges. These include increasing ambitions for regional climate targets, developing renewable energy, and promoting sustainable development.

The Institute for Essential Services Reform (IESR) believes that following the success of the energy transition agenda at the G20, Indonesia can foster cooperation among ASEAN countries to implement energy transitions in line with the targets of the Paris Agreement. This collaboration can help build joint efforts to strengthen resilience in the face of various threats and impacts of climate change, through sustainable development.

ASEAN already has the ASEAN Working Group on Climate Change (AWGCC) and ASEAN Working Group on Forest and Climate Change (AWGFCC), as well as ASEAN Energy Cooperation. However, achieving climate mitigation targets and advancing renewable energy require additional efforts and collaboration between these working groups, along with civil society organizations and transnational communities, to increase their contribution to the region.

IESR believes that Indonesia, as the Chair of ASEAN, can provide space for civil society at the regional level to be involved in the process of its chairmanship agenda in 2023, particularly regarding energy and climate issues.

“As one of the regional organizations projected to experience 4.7% economic growth in 2023 amidst weakening global demand, ASEAN is a promising region for investment, especially in the renewable energy sector. Leveraging its leadership in ASEAN, Indonesia can encourage and embrace civil society organizations in ASEAN to focus on the energy transition. By initiating concrete collaborations, together we can accelerate the energy transition in the region and tackle climate change,” said Fabby Tumiwa, IESR Executive Director, during the public discussion titled “Making Energy Green and Low Carbon to Support Sustainable Growth: Advancing the Role of Civil Society in Southeast Asia Energy Transition During Indonesia ASEAN Chairmanship 2023,” organized by IESR.

Economic growth in the ASEAN region needs to align with commitments to reduce greenhouse gas emissions following the Paris Agreement. ASEAN has set a target of achieving 23% of the renewable energy mix by 2025. However, according to the IEA, 80% of the primary energy mix in the Southeast Asian region still comes from fossil fuels. Reducing the cost of renewable energy is predicted by the IEA to increase the penetration of renewable energy in ASEAN by up to 70% by 2040. This can be achieved through intensive coordination and collaboration among stakeholders (government, civil society, and business stakeholders) in ASEAN, especially in the regional policy-making process.

Nevertheless, Arief Rosadi, Coordinator of the IESR Climate Diplomacy Project, highlights that ASEAN currently lacks a formal channel for civil society to express aspirations, particularly on climate and energy issues. Therefore, Indonesia needs to lead ASEAN in providing an inclusive and constructive dialogue space for civil society in the decision-making process within the region.

“One immediate step to take is to increase the intensity of communication between civil society in the region, enabling the sharing of information and the latest developments in each country regarding energy and climate issues. This aims to strengthen solidarity and a sense of ownership of ASEAN as a collective region,” said Arief.

According to him, Indonesia can encourage more public discussions that focus on knowledge exchange and provide data-based policy recommendations that support the acceleration of the energy transition through the development of renewable energy at the regional level. Additionally, this approach can offer opportunities for developing human resource capacity in the renewable energy sector.

“Another important action is to strengthen grassroots collaboration and civil society networks at the regional level. This collaboration can contribute to the achievement of the climate agenda and energy transition in the region by sharing good practices and technical knowledge,” Arief added.

Indonesia’s Potential to Becoming the Top Player in ASEAN’s EV Market

Jakarta, 12 May 2023 – During the 42nd ASEAN Summit held in Labuan Bajo, East Nusa Tenggara, ASEAN demonstrated its determination to develop an ecosystem for electric vehicles (EV). Within ASEAN, some member states have already established their own EV industries, namely Thailand and Indonesia. In Indonesia alone, production reaches 1.2 million units per year, and capable of engaging in export and import activities within ASEAN markets. 

Fabby Tumiwa, Executive Director of Institute for Essential Services Reform (IESR) explained that there are several factors to consider to promote the growth of the EV ecosystem, one of which is the development of the EV component industries, particularly batteries which can account for up to 40% of overall EV prices. Furthermore, discussions on batteries also involve talking about critical mineral industries, such as lithium, nickel, manganese, and cobalt. Not every ASEAN member states possesses these critical minerals, which positions Indonesia, as a nickel and cobalt producer, with the potential to be a hub for battery industry development. 

“However, other countries like Thailand possess other strategic advantages such as a more supportive investment climate for electric vehicle development. Therefore, it is not surprising that China prefers to establish factories in Thailand rather than Indonesia,” Fabby explained.

In addition to batteries, Fabby sees Indonesia’s potential as an electric vehicle supplier, and steel. Alloys are also required for EV frames, which Indonesia can supply due to its ownership of several iron ore industries. Domestically, Indonesia’s automotive industry has employed a significant amount of labor, so it is hoped that when the time comes to move away from  fossil fuel vehicles, Indonesia will not be solely reliant on importing electric vehicles. Considering Indonesia’s market potential, Fabby believes that middle-range vehicles (priced around Rp 400-600 million) are the most suitable and promising for the Indonesian market. 

“Furthermore, Indonesia will likely participate in the EV global supply chain, given our strategic advantages such as abundant natural resources, developed vehicle industries, and intermediate industries such as battery cells,” pointed out Fabby.

Fabby also commented that the incentives needed lie in the research and development of a new-generation battery. He highlights that nickel reserves will last less than 20 years if they continue to be extensively mined for battery production, which also applies to lithium.

Moreover, Fabby explains that the most viable strategy is to research for a new generation of batteries using readily available metals in Indonesia. Incentives are also necessary for downstream industries to stimulate the EV market until 2030. With the increasing demand of EV, it is hoped that Indonesia will attract more investors, consequently strengthening the domestic supply chain.

“In the future, we hope to have a complete industrial chain, encompassing not only battery production, but also vehicle manufacturing. Therefore, stimulus measures to boost demand must also be implemented,” Fabby concluded. 

Photo by dcbel on Unsplash

Public Discussion Making Energy Green and Low Carbon to Support Sustainable Growth: Advancing the Role of Civil Society in Southeast Asia Energy Transition Cooperation during Indonesia ASEAN Chairmanship 2023

Background

After having the opportunity to host the G20 last year, this time Indonesia has taken the mantle of ASEAN Chairmanship in 2023, which was previously held by Cambodia. This is the fourth time for Indonesia to take the chairmanship position of ASEAN, where the core theme is “ASEAN Matters: Epicentrum of Growth”. Within this theme, the Indonesian Foreign Minister Retno Marsudi mentioned that there will be two elements highlighted by the Indonesian government during its leadership, which are the increasing relevance of ASEAN both inside and outside of the region, as well as transforming ASEAN to be the center of global economic growth (Ministry of Trade, 2023). Retno also emphasized that the Myanmar issues–which have been a thorn in the flesh during rounds of ASEAN negotiations–should not “hold the ASEAN community development process hostage” and Indonesia will embrace its leadership role with optimism and positive outlook (Kementerian Luar Negeri, 2023).

Indonesia’s chairmanship in ASEAN 2023 will also carry over several priorities of last year’s G20, such as digital transformation, sustainable energy, and global economic recovery. Several issue priorities on energy formulated by the Ministry of Energy and Mineral Resources are closely related to the ASEAN Power Grid plan, a regional electricity interconnectivity project as an effort to maintain the stability of energy supply in ASEAN (ESDM, 2023). In regards to the climate change issue, Indonesia has been appointed as the chair of ASEAN Working Groups on Chemicals and Waste for 2022-2024. Within this working group framework, there is an ASEAN Plus Three Cooperation Work Plan which covers the issues of marine waste, climate change, biodiversity, and sustainable cities (Media Indonesia, 2022).

The Indonesia ASEAN Chairmanship in 2023 will be a challenging one, since ASEAN as an institution is currently under scrutiny that came from both inside and outside the region. According to a survey conducted by ISEAS-Yusof Ishak Institute (2022), around 82,6% ASEAN citizens considered ASEAN is starting to become irrelevant and inefficient in carrying out its role as a regional organization. The same survey also reported that 73% ASEAN citizens felt that ASEAN is currently an arena for major power’s struggle for influence. It is worried that ASEAN Member States will be major power proxies. Therefore, a collaborative enterprise is needed to strengthen the institutional capacity of ASEAN. With the success of its G20 presidency last year, it is hoped that Indonesia chairmanship will result with an ASEAN that is more adaptable to the pressing issues of the century, including energy transition and climate change.

In advancing Indonesia’s chairmanship in ASEAN 2023, Institute of Essential Services Reform will hold a public discussion targeted for civil society organizations in all ASEAN Member States, especially in the climate and energy sector. This public discussion is held with the objective to introduce the priority issues of Indonesia’s ASEAN Chairmanship 2023 and the decision-making process of ASEAN as an institution. Hence, it is expected that this event will be a platform for CSOs to actively voice their aspirations to ASEAN and also a chance to strengthen the CSOs network in ASEAN.

 

Objectives

  1. Introduction to the agendas of Indonesia ASEAN Chairmanship 2023, particularly on the issue stream of energy transition and climate change.
  2. Explanation of the ASEAN decision-making structure and how civil society can partake in the process.
  3. Exploring the aspirations and perception of civil society organizations in ASEAN Member States on the agenda of Indonesia ASEAN Chairmanship 2023.