Starting from 2019, the global average temperature has increased by 1.1 degrees Celsius, which is hotter than the pre-industrial period of the 1850s. The increase in temperature on the earth’s surface is an indication of an increase in the concentration of greenhouse gases, including carbon dioxide (CO2), methane (CH4), and nitrogen monoxide (N2O), which is trapped in the atmosphere.
Jakarta, 15 December 2023 – The Indonesian government continues to improve in terms of strengthening its commitment to climate change mitigation. Since starting to aggressively commit to climate mitigation in 2021, the Indonesian Government has continued to carry out follow-up actions through various assessments of funding commitments and creating decarbonization roadmaps in each sector.
Nurcahyanto, Policy Analyst for the Ministry of Energy and Mineral Resources (MEMR), said at the launch of the Indonesia Energy Transition Outlook (IETO) 2024 report organized by the Institute for Essential Services Reform that one of the efforts currently being carried out by the government through the Ministry of Energy and Mineral Resources is to carry out revision of the National Energy Policy (KEN). It is hoped that the results of the revised KEN will be more relevant to Indonesia’s current efforts to carry out comprehensive decarbonization, especially in the electricity sector.
“Target revision (KEN) is only a method based on numbers, but from an implementation perspective it must be supported by regulations and we need to optimize it. For example, in carrying out early retirement for PLTUs, a road map needs to be prepared, as well as consolidation with related ministries/institutions,” he said.
The issuance of Presidential Decree 112/2022 is one of the guiding documents for the decarbonization of Indonesia’s electricity sector, with the main point being to accelerate the cessation of coal-fired power plants.
August Axel Zacharie, Head of Energy Cooperation, Danish Embassy, said that in the global context, Indonesia’s position as a developing country (emerging economy) is an investment attraction in itself, but Indonesia needs to prepare a supportive ecosystem.
“Investment needs for the energy transition, which reach approximately 1 trillion USD until 2050, must be seen as not just building infrastructure, but within these cost requirements there are community aspects, job transition, quality of life, and other non-physical aspects,” added August.
Still related to the high need for investment in renewable energy, and the government’s obligation to guarantee energy security, the Indonesian Government provides energy subsidies. However, this policy is not a sustainable policy.
Evita Herawati Legowo, PYC Senior Fellow, stated that it is necessary to think about a more targeted method for providing energy subsidies.
“There needs to be involvement of all parties in this matter, not just collaboration but a clear division of tasks as to who does what, starting from industry, research, energy, as well as investors,” said Evita.
The Indonesian Government’s commitment to decarbonization is a binding guideline. Delivered by Unggul Priyanto, Main Expert Engineer, BRIN, especially after 2060, all energy sources must come from clean energy sources.
“(The use-ed) LNG, or natural gas, is one option during the transition. But after 2060, like it or not, it has to be replaced with a truly clean (energy source-ed),” he said.
The Institute for Essential Services Reform (IESR) states that the trend of renewable energy development is slowing, reaching only 0.97 gigawatts (GW) out of the targeted 3.4 GW in the fourth quarter of 2023. If this trend continues, Indonesia is at risk of not achieving its emission peak because the decarbonization of the power sector tends to stagnate, while emissions from the demand sector continue to rise.
Read more on Kata Data.
Jakarta, 5 December 2023 – Since 2021 the transportation sector in Indonesia has been ranked as the second highest emitter, displacing industry. Many emissions from the transportation sector are caused by burning fuel, which is the main energy source for vehicles. With projected economic growth and development plans, it is predicted that emissions from the Indonesia’s transportation sector will continue to increase. As an effort to strengthen climate change mitigation actions, decarbonization of the transportation sector is important.
Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR) in the webinar entitled “Dissemination of Indonesia’s Transportation Decarbonization Roadmap”, (5/12) emphasized that to ensure each climate change mitigation actions are in line with the Paris Agreement, emission reduction targets must be calculated not just based on percentages but also taking into account alignment with Paris targets.
“IESR carries out modeling to find policies and steps that can be taken to increase Indonesia’s climate change mitigation actions, especially in the transportation sector,” said Fabby.
The draft transportation decarbonization roadmap focuses on two scales, namely the national and regional scales (Jabodetabek).
IESR sustainable mobility analyst, Rahmi Puspita Sari added that the increase in private vehicle ownership, especially motorbikes, has been one of the factors causing increased emissions from the transportation sector.
“With various types of demand growth and the choice of mode still being private transport, this has an impact on greenhouse gas (GHG) emissions in the transportation sector. “Most of the GHG emissions come from passenger transportation (73%), and followed by land transportation (27%),” said Rahmi.
Fauzan Ahmad, member of the Tasrif Modeling Team, who participated in modeling the transportation decarbonization road map, explained one of the main findings from this simulation, namely that in the Avoid, Shift, Improve (ASI) scheme, which is quite common for transportation management, there is potential for reducing emissions up to 18% by avoiding travel by implementing a work from home (WFH) system.
“Actually, only 8% of the total workers can work from home, of this 8% potential, currently only around 1% of workers work from home. If this potential is maximized, we can reduce emissions even more by the number of trips avoided,” said Fauzan.
Fauzan also added that the choice to review transportation patterns in Jabodetabek was because Jabodetabek was considered as a unified area that interacts with each other.
Arij Ashari Nur Iman, a modeler from the Tasrif Modeling Team, added that with the current condition of the transportation system, the most effective solution for decarbonizing the transportation sector is to divide passenger loads into various modes (mode share).
“Electric vehicles will have a big impact on the goal of reducing emissions, but two conditions must be achieved to have an impact on a national scale, namely increasing the sales share of electric vehicles and creating a policy framework that supports the discard rate of ICE vehicles. Modal shifting to public transportation will be a sustainable solution in the context of fuel and resource use, but requires large initial investment,” explained Arij.
Professor of civil engineering at Gadjah Mada University (UGM), Agus Taufik Mulyono, stated that the Indonesian government still does not have the courage to create (transportation) policies that encourage share modes.
“This share mode issue must be regulated by the government in law, currently there is no law. This study is good, because when more advanced modes of sharing are deemed difficult, then both are still road transportation, but shared between spaces,” he said.
Agus also reminded of implementation challenges if the recommendations of this study were adopted in the form of policies or regulations.
In line with Agus, Alloysius Joko Purwanto, Research and Development Commission, Jakarta City Transportation Council also highlighted the use of public transportation which should be further encouraged.
“Current policies have the potential to cause contradictions, such as the electric vehicle incentive policy, which on one hand has the potential to increase private vehicle ownership rates and has the potential to increase traffic jams because the discard rate for ICE vehicles is still low,” said Joko.
The use of biofuels is also included in the transportation decarbonization roadmap modeling. Edi Wibowo, Director of Bioenergy, Ministry of Energy and Mineral Resources, said that the results of this study are broadly in line with Indonesia’s energy transition road map which will generally add renewable energy capacity to power plants and other sectors will also follow to shift to a more efficient system like such as biofuel.
“We (at the Ministry of Energy and Mineral Resources) continue to develop biofuels, currently we are testing the application of Biodiesel B40 and if the process goes smoothly in 2026 it will start to be used. This (development) effort is a form of real support for Indonesia’s energy transition plan,” said Edi.
Gonggomtua E. Sitanggang, Director, ITDP Indonesia emphasized the importance of public communication to raise awareness among the public. When the public has sufficient awareness and knowledge about the importance of a low-emission transportation system, it will be easier to involve and mobilize them to slowly reduce their dependence on the use of private vehicles.
“Apart from that, it is also important to look at the relationship between the national government and regional governments. What needs to be underlined is our laws and regulations relating to regional autonomy (otonomi daerah), where the one who has the budget and authority is the regional government, while transportation has not yet become one of the KPIs (key performance indicators) for regional leaders. As a result, the budget for the transportation sector is very minimal,” said Gonggom.
Jakarta, 21 November 2023 – Chemical industry is considered as one that is heavy on emission. In Indonesia, various industries, including iron & steel, pulp & paper, cement, and textile interconnect with the chemical industry. The integration of the Indonesian chemical industry, especially ammonia, into the fertilizers industry, contributes to Indonesia’s position as the fifth largest ammonia producer in the world. Indonesia’s proactive measures to green its ammonia industry significantly impact the global ammonia landscape.
Faricha Hidayati, the project coordinator for industry decarbonization at the Institute for Essential Services Reform (IESR) during the webinar titled “Greening the Chemical Industry: International Perspective and Insights” highlights the amount of emission released for every ton of ammonia produced.
“For every ton of ammonia produced, its average direct emissions are 2.4 tons of CO2. It is two times higher than crude steel and four times that of cement,” Faricha said.
Given that huge number of emissions, the ammonia industry accounts for 2% of global energy usage. Therefore, decarbonizing the industry is evidently crucial. Faricha further explained that IESR is currently proposing four pillars to decarbonize the ammonia industry in Indonesia: material efficiency, energy efficiency, green ammonia, and the utilization of CCS during the process.
Faricha added that there is an opportunity to propel the ammonia industry in Indonesia as they are already aware of their emission and have the willingness to figure out a way to limit the emission.
“Another opportunity is Indonesia’s vast potential for green hydrogen projects, coupled with variable renewable energy up to 3,686 GW,” she said.
After assessing the current status quo, IESR urges the government to set a clear emission reduction target for the industrial sector. Though currently Indonesia already has a grand vision on achieving net zero emissions in 2060 or sooner, there is still no clear target and roadmap for the industry sector in contributing to the NZE goal.
Implementing the energy efficiency measures in the ammonia industry is considered as the low- hanging fruit to decarbonize the industry sector. This approach requires least initial investment and technology adoption, while advocating for the long-term strategies.
The full version of the webinar “Greening the Chemical Industry: International Perspective and Insights” can be watched here.
The average global carbon price is still considered too low to achieve zero carbon emissions by 2050. A higher carbon offset price could generate more funds for environmental conservation projects that support achieving carbon neutrality.
Read more on Kompas.
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.
Jakarta, 3 November 2023 – The Conference of the Parties (COP 28) will soon be held in Dubai, United Arab Emirates. One of the agendas for this annual meeting is to see the progress of global actions to deal with the climate crisis. In a public discussion held by the Foreign Policy Community Indonesia (FPCI) on Friday 3 November 2023, Marlistya Citraningrum, Sustainable Energy Access Program Manager, Institute for Essential Services Reform (IESR), explained that in anticipation of this annual meeting of world leaders, the new Indonesian Government just released the Comprehensive Investment and Policy Plan (CIPP) document and plan to announce the investment plan officially at the COP 28.
“Bluntly speaking, this document is quite disappointing because even though it promises a list of renewable energy projects, it is still very focused on large-scale renewable energy (base-load renewables) such as hydro and geothermal. Variable Renewable Energy (VRE) such as solar and wind is considered a high-risk project,” explained Citra.
Apart from the lack of support for VRE, Citra also highlighted the low commitment to early retirement of coal power plants. In the CIPP document, which is currently in the public consultation process, IPG countries are only willing to facilitate early retirement of 1.7 GW coal. In a draft document last year, the United States and Japan were initially willing to finance 5 GW of early retirement coal-fired power plants.
“In fact, to achieve the net zero emission target, Indonesia needs to retire around 8 GW of coal,” emphasized Citra.
The Director of the Environment at the Ministry of National Development Planning/Bappenas, agreed on the importance of increasing climate commitment and action, not only as climate action but also as part of development.
“In the draft RPJPN which is currently progressing, we are targeting our emission reduction target to increase to 55.5% in 2030 and 80% in 2045. This is a necessity to increase climate targets and ambitions,” said Medril.
Jakarta, 25 October 2023 – Industry is the main driver for economic growth and the largest sector to stimulate technology advancement. Industrial-scale economic activity has already transformed the global economy since its peak. Unfortunately, the tremendous economic growth must be paid for by the high greenhouse gas emissions transmitted.
For a while, people are trying to figure out a way to minimize the GHG emission from the industrial process. This effort will be a meaningful step in the race to achieve net zero emission in this century as it is mandated by the Paris Agreement.
Deon Arinaldo, Energy Transformation Program Manager at the Institute for Essential Services Reform (IESR) during the Dissemination Workshop of Indonesia Industry Decarbonization Roadmap and Policy Recommendation on Wednesday 25th October 2023 said that IESR is currently looking into five big industries i.e cement, pulp & paper, steel, textile, and ammonia and develop a decarbonization roadmap.
“We are in the beginning of decarbonizing our industry sector, and we need more collaboration between stakeholders as there are just so many stakeholders involved in the industry sector,” Deon said.
Farid Wijaya, senior analyst IESR later explained that Indonesia has initiated a green industry policy framework, yet it still needs more improvement to make it more robust and contextual.
“The five industries that we are looking at are highly motivated to decarbonize their business process, but currently there are still challenges such as the cost and policy framework that still need to be improved,” explained Farid.
Realizing that the industrial process requires a vast amount of energy from electricity to decarbonize the industry sector, it is a must to also decarbonize the power sector.
“(The availability) of policies that support industry to connect to renewable power or develop its own renewable electricity are very important,” said Hongyou Lu, Energy and Environment Technology Researcher, LBNL.
Lu added that industry decarbonization is inevitable but multifaceted and it has potential to grow the local economy, reduce air pollution and make the commodity more competitive in the global trade.
Stephane de la Rue du Can, Energy-Environmental Policy Research Scientist, LBNL then added that there should be a complete package of policy reform to decarbonize the industry sector, including (1) industry GHG reduction targets and planning, (2) innovation, (3) electrification and fuel switching, (4) energy efficiency, (5) material efficiency and circular economy, and (6) workforce and local communities.
Endra Dedy Tamtama, Energy Conservation Monitoring Coordinator, Ministry of Energy and Mineral Resources shares that currently energy efficiency practices done by some industries are those either no cost or low cost. Things related to retrofitting utilities that require significant capital cost are not yet done.
“Because currently there is no fiscal incentive is given to industries once uses an energy efficient infrastructure, any changes that require significant cost, although it will save more energy, has not fully tapped,” Endra said.
Muhammad Akhsin Muflikhun, Technology Expert of PSE UGM, emphasized the importance of technology readiness to support industry decarbonization such as the utilization of hydrogen.
“Hydrogen has been our focus for energy storage technology. We try to compare hydrogen storage vs. batteries, so far there is still a huge gap in energy efficiency once it is stored in a battery compared to once it is kept in a hydrogen storage system,” he said.
Sri Gadis Pari Bekti, Functional Intermediate Expert, Ministry of Industry agrees that technology will be a game changer during the industrial decarbonization. The emerging technology such as CCS and CCUS, and hydrogen are expected to be able to fulfill energy needs in the industry.
“As part of our support to industry, we facilitate certification for industry. To some extent, the government can help the capacity building and certification process,” Bekti said.
In order to smoothen the industry decarbonization the availability of green financing is crucial.
PT PLN, as the main energy supplier in Indonesia through their Bioenergy manager, Yudas Agung Santoso, said that currently they are still mapping the energy needs especially from industry as in the near future some big industries such as nickel smelter will come.
“For industry (and those who need) currently, we have a Renewable Energy Certificate (REC) program, in which we dedicate a renewable power generator to supply those who subscribe the certificate so they can get green electricity,” he said.
Nan Zhou, Energy Environmental Policy Senior Scientist, LBNL, in her concluding remark highlighted the importance for Indonesia to take the lesson learnt from other countries who start decarbonizing its industry earlier.
“We don’t have a choice; we have to achieve carbon neutrality. So, we must do any possible action to make it happen,” Zhou said.
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