Waiting for JETP Implementation in Indonesia

Raden Raditya Yudha Wiranegara

Pakistan, May 31, 2023 –  The energy transition is being discussed in many countries, including Pakistan. Some of the challenges faced by Pakistan in adopting renewable energy include inadequate electricity infrastructure and network integration. Similar to Pakistan, Indonesia also faces similar challenges. Still, the government’s fast action is needed to reduce the use of fossil energy as a concrete step to reduce greenhouse gas emissions.

Raden Raditya Yudha Wiranegara, Senior Researcher at the Institute for Essential Services Reform (IESR), explained the electricity sector contributes around 40% of greenhouse gas emissions in Indonesia based on the 2023 Indonesia Energy Transition Outlook (IETO) report and achieves net zero emission by 2060 or faster, Raditya said, it is necessary to transition all energy supplies. One is changing the electricity sector by gradually reducing fossil fuels in PLTU. According to Raditya, coal-fired power plants must be reduced or retired in stages until 2045 to align with the 1.5°C ambition.

“The first phase is carried out by closing 18 coal power plants with a total capacity of 9.2 GW until 2030, then 39 coal power plants with a total capacity of 21.7 GW, and 15 coal power plants with a total capacity of 12.5 GW,” explained Raditya in the Symposium on “Accelerating the Just Energy Transition in Pakistan” organized by the Sustainable Development Policy Institute (SDPI) on Wednesday (31/5/2023).

In fulfilling the 1.5°C ambition, Indonesia’s Just Energy Transition Partnership (JETP) is one of the driving forces. Raditya explained that the partnership includes a peak emission target 2030 for the Indonesian electricity sector, including on-grid, off-grid, and captive power generation systems, shifting the projected peak emissions by about seven years earlier. Apart from focusing on significant emission reductions, JETP is also promoting sustainable development and economic growth and protecting the livelihoods of people and workers in the affected sectors.

To implement this target, Raditya said, currently the JETP Indonesia Secretariat, is developing a comprehensive investment plan (CIP) for the Just Energy Transition Partnership (JETP) funding program. However, Raditya stressed the JETP Indonesia Secretariat only had a limited time to complete it, bearing in mind that the document needed to be published in August 2023. Regarding the work on the comprehensive investment plan document, Raditya emphasized that it was hoped that the analysis results in the working group could be included in it in July 2023. The working groups in JETP Indonesia consist of 4 working groups representing various parties, including the Indonesian government, national and international institutions, and elements of civil society who have expertise in their respective fields. The working group oversees Technical, Policy, Funding, and Equitable Transition.

“Reflecting on these conditions, transparency and availability of data is a problem in the working group. This needs to be a concern considering that these conditions can hinder each group member from carrying out the assigned tasks,” said Raditya.

The CIP document will contain technical, funding, policy, and socio-economic information regarding energy transition investments in the electricity sector up to 2030 which will form the basis for implementing the USD 20 billion partnership under JETP Indonesia. Based on the JETP Indonesia Joint Statement, funding mobilization is targeted to occur in years 3 to 5 after the JETP Indonesia funding partnership is agreed upon. In addition, the investment areas that have been agreed upon in the CIPP consist of developing transmission and distribution networks, early retirement of coal-fired power plants, accelerating the use of baseload type renewable energy, accelerating the use of variable type renewable energy, and building a renewable energy supply chain.

Observing the Efforts to Increase Electricity Consumption in Indonesia

Sinergi Stakeholder dalam Upaya Peningkatan Elektrifikasi dan Konsumsi Listrik per Kapita di Indonesia

Surabaya, November 25, 2022 – Electrical energy is one of the human needs that integrates into daily needs. Increasing access to electricity through 100 percent electricity ratio also needs to be coupled by providing energy sources that are more environmentally friendly.

Akbar Bagaskara, Electricity System Researcher, Institute for Essential Services Reform (IESR), in a public discussion forum with the theme “Stakeholder Synergy in Efforts to Increase Electrification and Per Capita Electricity Consumption in Indonesia” organized by the Directorate General of Electricity, Ministry of Energy and Mineral Resources, stated that there are five countries in ASEAN that have not achieved a 100% electrification ratio, such as Cambodia, Laos, Myanmar, Indonesia, and the Philippines.

“Based on data from the ASEAN Center of Energy as of 2021, Indonesia has an electrification ratio of 99%, followed by the Philippines at 97%, Laos at  95%, Cambodia at  81%, and Myanmar at 51%. Indonesia and the Philippines have not yet achieved a 100% electrification ratio due to the condition of the archipelagic countries. This condition is a challenge compared to other ASEAN countries, which are mainland, therefore, it is easier to distribute electricity, “explained Akbar.

Observing the electrification ratio must be connected to electricity consumption in Indonesia. Akbar said that the majority of electricity consumption in the household sector is used for lighting. As for cooking, they still use liquefied petroleum gas (LPG), with a ratio of total energy consumption in the household sector of up to 49%.

“The existence of these conditions creates the potential to electrify stoves used by the household sector, replacing LPG,” said Akbar.

In addition, based on data from the Ministry of Energy and Mineral Resources, said Akbar, electrification in the transportation sector still tends to be low, around only 1%. According to him, the Indonesian Government’s program to promote electric cars is crucial to increasing the adoption of electric vehicles.

“Full utilization of electrification potential will create opportunities to increase electricity consumption in the transportation and household sectors,” said Akbar.

Furthermore, Akbar explained that electrical energy use in Indonesia and other ASEAN countries is still only around 20%. It can be seen based on energy consumption data per capita for 2018-2021. On the other hand, based on the MEMR 2020-2024 Strategic Plan (RENSTRA), Indonesia’s electricity consumption target per capita is 1,408 kWh. Meanwhile, the average electricity consumption in ASEAN itself is around 3,672 kWh per capita.

Head of the Electricity Sector at the East Java ESDM Office, Waziruddin, stated that based on an electrification ratio of 99.32% in the third quarter of 2022, there are households that have not had electricity connections. This can also be seen from the number of low-income families (RTM) in East Java that do not have electricity, around 126,708. However, his party has budgeted around IDR 12 billion in house installation grants in 2023 and various other assistance to provide access to electricity for these households. In addition, Waziruddin  stated that the East Java Provincial Government continues to push for an energy transition policy to increase energy security.

“For example, using geothermal as a substitute for coal energy in power plants, considering that East Java is rich in geothermal potential. In addition, several industries in East Java have also installed rooftop solar power plants, developed biomass power plants, and utilized biofuels,” said Waziruddin.

Edy Pratiknyo, Sub-Coordinator of Business Commercial Relations Facilitation, Ministry of Energy and Mineral Resources, stated that the Directorate General of Electricity is pushing for an accelerated increase in electricity consumption.

“With the program to increase electricity consumption, the government is pushing through accelerating permits for charging infrastructure for Battery-Based Electric Motorized Vehicles (KBLBB),” Edy concluded.