Three Principles of Equity in Indonesia’s Energy Transformation

Marlistya Citraningrum, Manajer Program Akses Energi Berkelanjutan dalam Sustainability Media Academy pada Kamis (30/11).

Jakarta, November 30, 2023 – Indonesia, like many other countries, faces a critical turning point amid the global climate crisis. As a nation with abundant energy resources, the transition towards renewable energy is urgently necessary. However, this shift must prioritize fairness and equality for all. The energy transition must not solely focus on technical aspects but also consider the social, economic, and moral impacts on the affected communities. In Indonesia, this transition is not just a technical step, but also a moral obligation to ensure that every individual has equal rights in this change.

“We must examine three principles to achieve justice in the energy transition. The first principle is justice at the local level, where we need to take a closer look at which parties directly benefit from and are affected by the energy transition at the local level. For example, we need to assess whether the community around the mine is reaping any benefits from the energy transition,” said Marlistya Citraningrum,  Program Manager of Sustainable Energy Access, at the Sustainability Media Academy on Thursday (30/11).

Furthermore, Marlistya Citraningrum mentioned another principle from the authority perspective. This means that the community needs to see how the local government authority manages the transition. This includes the policies and regulations implemented to ensure fairness for all parties involved. Long-term justice must also be considered, which consists of the community’s participation in managing the future once the mining industry ends. During this time, the community’s welfare must be considered while ensuring the continuity of the economy.

During the energy transition process, it’s crucial to consider the availability of affordable, sustainable, and reliable energy. The instability in energy supply can hinder the achievement of sustainable development goals. Hence, it’s essential to establish a dependable energy system by investing in energy storage technologies, reliable distribution networks, and diversification of energy resources.

“To achieve a successful energy transition, it is crucial for the government, private sector, and communities to work together collaboratively. Education and community engagement programs can enhance people’s understanding of the significance of affordable, sustainable, and dependable energy. By enabling communities to participate in this transformation actively, positive outcomes can be experienced locally,” Marlistya said. 

Marlistya also emphasized that the government must involve more stakeholders, including indigenous peoples, women, youth, and other marginalized groups, in the planning and decision-making processes. This will ensure that all groups are treated equally and included in the opportunities created by the just transition. Social inclusion is also important to ensure that vulnerable groups have fair access to these opportunities.

“In addition to evidence-based policies, equitable energy principles should be applied through the GEDSI approach that emphasizes empathy and involvement in decision-making,” said Marlistya.

Promoting Massive Use of Solar Energy in Jambi

Jambi, 28 November 2023 – In the General National Energy Plan (RUEN) document, Indonesia targets 23% renewable energy mix by 2025. Until 2023, Indonesia has only achieved 12.5% renewable energy in its energy mix. In the Jambi Government Forum organized by the Institute for Essential Services Reform (IESR) in collaboration with the Jambi Province Energy and Mineral Resources Office (ESDM) (28/11), Yunus Saefulhak, Head of the Energy Policy and Hearing Facilitation Bureau stated that the National Energy Council (DEN) predicts that in 2025 Indonesia will only reach 17-19 percent of renewable energy in the national energy mix.

“The province’s role in pursuing predetermined renewable energy targets is important, in accordance with the potential in each region,” said Yunus.

Yunus added that Jambi does have quite a lot of fossil resources, but it can still seize various opportunities to develop renewable energy, such as the use of rooftop PV on government buildings.

Anjas Bandarso, Energy Policy Analyst from the Directorate General of Regional Development, Ministry of Home Affairs, in the same forum highlighted the limited authority of regional governments for energy matters.

“Whatever the sub-national government does, as long as there is no authority given to the regional government, it will just be a story. So the central government is looking for ways in which regions can develop new, renewable energy. “This can be realized with Presidential Decree 11/2023 concerning additional concurrent authority for regional governments,” said Anjas.

Nanang Kristanto, Sub-Coordinator for RUEN Implementation Monitoring, National Energy Council, added that whatever target is the government’s priority, whether for Net Zero Emission (NZE) or achieving renewable energy mix figures, local governments have an important role.

“Regional governments have an important role in pushing the energy transition agenda by maximizing energy transition derivative activities in their regions, funding support, preparing human resources to maintain decentralized generating installations, as well as socializing new renewable energy in districts and even sub-districts,” said Nanang.

Apart from having natural products such as oil palm plantations and coal producers, Jambi also has large renewable energy potential. Jambi Province is targeting a renewable energy mix of 24% by 2025, and this target is optimistic that it will be achieved because currently the Merangin-Kerinci hydroelectric power plant with a capacity of 350 MW is being built.

Jambi also has quite large solar energy potential, reaching 281.5 GW based on land suitability. Marlistya Citraningrum, Sustainable Energy Access Program Manager, IESR stated that solar energy could be an option that allows various parties to contribute to the availability of clean electricity.

“Installing rooftop PVs has a number of benefits, such as being a means of mutual cooperation in achieving energy mix targets and reducing emissions, providing clean electricity sources in various regions, opening up business/employment opportunities for local residents, as well as increasing the competitiveness of the solar industry/business in Indonesia,” he said.

Marlistya added that the public wants incentives for rooftop PVs users, which could be in the form of ease of licensing, or facilitation of financing by the government.

Solar Energy Can Be a Strategy to Achieve Renewable Energy Targets in Jambi

press release

Jambi, November 28, 2023 – Local governments play a significant role in promoting the use of renewable energy in their respective regions. This is crucial in achieving the national target for renewable energy mix. Jambi is one region that aims to achieve a renewable energy mix target of 24 percent by 2025 and 40 percent by 2050. The Institute for Essential Services Reform (IESR), a leading think tank in Indonesia, underlines the importance of accelerating solar energy utilization in Jambi Province as a concrete step in achieving the regional renewable energy mix target and reducing greenhouse gas emissions contributing to the climate crisis.

Based on IESR’s study titled Beyond 443 GW: Indonesia’s Infinite Renewable Energy Potentials, Jambi has 281.5 GWp of solar energy potential. Meanwhile, based on the Regional Energy General Plan, Jambi has a solar potential of 8,847 MW. However, the installed capacity of solar power plants is only around 0.68 MW as of 2022.

 

Marlistya Citraningrum, Program Manager of Sustainable Energy Access, IESR, mentioned that solar energy is democratic energy available throughout Indonesia. In addition, solar energy technology is currently relatively easy to access, with increasingly affordable investment costs.

“We believe solar energy is a strategic solution to mitigate the climate crisis. Rooftop solar power plants offer several benefits, such as increasing the renewable energy mix and reducing greenhouse gas emissions through the cooperation of various parties. They provide a renewable source of electrical energy without the need to build large-scale power plants. This opens up business opportunities in the green jobs sector and encourages increased competitiveness of the solar industry in energy. We hope that Indonesia will not only become a market for the solar energy industry but also spark a green and circular economy,” Marlistya said at the Jambi Government Forum, Implementation of Solar Energy in Jambi Province held on Tuesday (28/11).

Marlistya invited all stakeholders to proactively participate in accelerating solar energy utilization in Jambi Province. She emphasized five things that can be done to spur the adoption of solar power at the regional level.  Firstly, clear rules, regulations, and policies should be implemented effectively. Secondly, there should be encouragement for rules, policies, and appeals. Thirdly, good practices in solar energy utilization should be shared and multiplied. Fourthly, access to information on renewable energy, particularly solar energy, should be improved. Lastly, incentives and facilitation, along with increased financing opportunities, should be provided to support the adoption of solar energy.

Nanang Kristanto, Sub-Coordinator of RUEN Implementation Monitoring, National Energy Council, explained that Indonesia is currently updating Government Regulation No. 79/2014, which pertains to the National Energy Policy (KEN). The purpose of this update is to ensure that energy policies are in line with climate change policies. It is predicted that by 2030, the energy sector will be the second largest contributor to emissions, following the forestry sector.

“The KEN Draft Government Regulation (RPP) has undergone updates, which include the consideration of achieving Net Zero Emission (NZE) by 2060. The primary energy mix in 2060 is planned to comprise 70-72% renewable energy and 28-30% non-renewable energy. The supporting policies for this goal are explained in detail in each article, which has increased the total number of articles in the KEN RPP,” said Nanang. 

Nanang highlighted five important roles of regions in the energy transition towards NZE in the KEN changes. First, all activities related to the transition must be centered in provincial and district/city areas. Secondly, derivative activities for energy transition must be implemented according to the authority of the regions. Thirdly, the parts should receive funding from the central government or the private sector to aid in the transition. Fourthly, the areas must have available human resources to support the transition’s new technologies. Finally, it is important to socialize with the community as energy users to implement the transition effectively.

Anjas Bandarso, Energy Policy Analyst from the Directorate General of Regional Development of the Ministry of Home Affairs, explained the strengthening of provincial authority in utilizing renewable energy in the regions through Presidential Regulation (Perpres) Number 11 of 2023 concerning Additional Concurrent Government Affairs in the Energy and Mineral Resources (ESDM) Sector in the New Renewable Energy Sub-Sector. The regulation also optimizes coordination between the central government and regional governments.

“We provide new authority for provincial governments to manage biomass or biogas, both as energy and as a substitute fuel for liquefied petroleum gas (LPG). Then, the management of various renewable energies as well as the implementation, guidance, and supervision of energy conservation,” said Anjas. 

Anjas hopes that there will be mutual support between the central and regional governments, strong political commitment, and real concern at the regional level to encourage the achievement of renewable energy targets.

SE-Bali 2023 Event Invites Balinese People to Success Bali NZE 2045

Bali, November 25, 2023 – The Provincial Government of Bali has launched Bali towards Net Zero Emission 2045 or Bali NZE 2045 in August 2023. Strategy implementation and collaboration with various parties continue to be carried out to achieve the initiative’s target of net zero emissions. Supporting this initiative, the Institute for Essential Services Reform (IESR) in collaboration with some communities held Sustainable Energy Bali (SE-Bali) 2023 on Saturday and Sunday, November 25-26, 2023. In addition to promoting the use of renewable energy, the event also aims to encourage togetherness for the achievement of the Bali NZE 2045 target.

Fabby Tumiwa, the Executive Director of IESR, views that the achievement of the Bali NZE 2045 target will affect sustainable economic improvement, particularly in the tourism sector which is the backbone of Bali. He believes that Bali will be able to achieve the NZE target, which is 15 years ahead of the national target.

“There are three reasons that make Bali strategic to achieve this target. First, the Balinese culture is very close to maintaining harmony with nature. Second, the government has the spirit to make Bali sustainable with sustainable energy. Third, renewable energy will make Bali more attractive for tourists to visit along with increasing world awareness to overcome the climate crisis,” said Fabby.

Head of the Bali Manpower and Energy and Mineral Resources (ESDM) Office, Ida Bagus Setiawan, revealed that achieving Bali NZE 2045 is a joint work. 

“Bali NZE 2045 is not only about the Bali Provincial Government program but also about how we can be involved in protecting Bali’s nature. For this reason, in addition to accelerating the use of renewable energy, the Bali Provincial Government also encourages the improvement of human resources (HR) related to individual understanding of the importance of reducing emissions to increasing the ability of vocational students to be absorbed in green jobs,” said Ida Bagus Setiawan.

Prof. Ida Ayu Dwi Giriantari, Chairperson of the Center of Excellence Community of Based Renewable Energy (CORE) Udayana University, mentioned that Nusa Penida became an early area to achieve net zero in the Bali NZE 2045 program, with a target of 100% renewable energy by 2030. One of the concrete steps to support this vision is the operation of a hybrid solar PV in Nusa Penida with a capacity of 3.5 Megawatt peak (MWp). Located on 4.5 hectares of land, the solar PV is a clean and sustainable  energy, and it has the potential to become an attractive ecotourism destination in Bali.

“Achieving the 100% renewable energy target in Nusa Penida is a real step in supporting sustainability and ecosystem balance. We strongly believe that the potential of renewable energy, such as solar, wind, and hydro, can be maximized to achieve environmental sustainability,” explained Prof Ida Ayu.

Digging Deeper into the Impact of the Energy Transition on Coal Producing Regions

Jakarta, 21 November 2023 – Indonesia is one of the largest coal exporting countries in the world. Coal production in Indonesia is concentrated in four provinces, namely East Kalimantan, Central Kalimantan, North Kalimantan and South Sumatra. The coal or mining sector is a significant component of the local economy of these coal producing regions.

The global energy transition agenda means that every country has the potential to reduce coal demand. This will be the main threat to coal-producing provinces if it is not addressed strategically.

Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), in the Media Dialogue: Just Transition in Coal Producing Regions in Indonesia stated that the trend of decreasing coal production will be felt starting in 2025 based on IESR projections.

“Starting from this hypothesis, we try to look at four aspects of the energy transition in coal producing areas, namely the employment sector, local communities who are economically dependent on the mining industry, regional income and expenditure budget (APBD) revenues, and the regional economy as a whole,” said Fabby.

For this reason, Fabby emphasized the importance of preparing coal producing regions to make the transition because there will be a significant economic impact if the transition process is not prepared now.

Syahnaz Nur Firdausi, IESR climate and energy analyst, explained that one of the main findings of this study was the significant contribution of the mining sector to regional income.

“The mining sector’s contribution to GRDP is 50% in Muara Enim and 70% in Paser. However, this large contribution is not directly proportional to the added value to labor wages or other multiplier effects. In other words, the profits from the mining sector are mostly enjoyed by companies, not the surrounding community,” said Syahnaz.

Martha Jessica, social and economic analyst at IESR, added that there is a gap in understanding between the community, local government and mining companies. Mining companies are aware of the trend to switch to renewable energy, and they are indeed planning to transition.

“There needs to be communication between companies, local governments and communities regarding the company’s transition plans and new business models so that local governments and communities can prepare,” said Martha.

The findings of the IESR study were agreed by representatives of the Muara Enim and Paser regional governments. Head of Muara Enim Regional Planning Agencies, Mat Kasrun, stated that his regional economic growth was exclusive.

“Economic growth in Muara Enim is around 8.3% in 2023, but the extreme poverty rate is still at 2.9%. This means that high economic growth is only enjoyed by a handful of people,” he said.

Conditions in Paser district are more or less similar where the contribution of the mining sector to regional income is very huge. Rusdian Noor, Secretary of Regional Planning Agencies for Paser district, stated that his region needs special assistance to face this era of energy transition.

“75% of Paser district’s income in 2022 contributed by the mining and agricultural sectors, and much of the GRDP spending allocation is for infrastructure development. If we immediately switch to clean energy and the mine is no longer operating, we will no longer be able to carry out development. Thus, we need special assistance so that with this transition, we don’t lose (economic, ed) power,” said Rusdian.

Reynaldo G. Sembiring, Executive Director of the Indonesian Center for Environmental Law (ICEL), responded to this study by underlining the limited authority of regional governments in energy matters. For this reason, a comprehensive approach is needed to ensure the transition process runs fair and smooth.

“A just transition is a transition that supports ecosystem recovery and repair. This energy transition could be a momentum for policy harmonization between the national and sub-national government,” he said.

Nikasi Ginting, Secretary General of the DPP FPE Confederation of All Indonesian Trade Unions, highlighted the gap in the number of workers needed from this energy transition.

“An example of what happened in Sidrap in 2013, when the wind power plant construction process required up to 4,480 workers, but when it was completed and during the operational phase, only hundreds of workers were needed. The fate of those thousands of workers must be a common concern,” she concluded.

The complete report of “Just Transition in Coal Producing Regions in Indonesia” can be downloaded here.