Indonesia Towards the Green Hydrogen Era

Bogor, February 6, 2024 – In facing the increasingly urgent challenge of climate change, one of the crucial steps that must be taken is to accelerate investment in clean energy technologies. One of the most prominent recent innovations is the development of green hydrogen. Based on data from the Ministry of Energy and Mineral Resources (MEMR), Indonesia has a renewable energy potential of around 3,686 gigawatts, which makes it possible for the country to produce green hydrogen.

Farid Wijaya, Senior Analyst at the Institute for Essential Services Reform (IESR), explained that, unlike fossil fuels, hydrogen energy generates only water, electricity, and heat when converted, it does not leave any trace of greenhouse gas emissions or fine dust. The production process is also environmentally friendly, particularly when using the electrolysis method to separate hydrogen from water compounds, where an electric current is used to break down water molecules into oxygen and hydrogen gas. This makes green hydrogen a way to respond to the need for environmental balance and offers opportunities to create new markets and value for industries around the world. 

“According to the IESR study conducted with the Ministry of Investment / Investment Coordinating Board (BKPM), green hydrogen has several significant benefits. These include reinforcing national energy security, accelerating decarbonization, promoting a sustainable economy, storing excess electricity, and enabling fair access to renewable energy. It is an efficient alternative to fossil fuels that can be converted into NH3, alcohol (such as methanol and ethanol), methane, and synthetic fuels. Additionally, its energy density is higher than batteries while being equally practical to fuel oil (bahan bakar minyak, red)” Farid said in the Stakeholders Consultation Forum on the Development and Utilization of Hydrogen and Ammonia on Tuesday (6/2/2024). 

Furthermore, Farid highlighted several factors that support the commercialization of green hydrogen. First, the advantages, benefits, and obligations in use. Second, the availability and accessibility of technology, time, and safety. Third, affordable and competitive prices are accompanied by investment and operations. Fourth, user, environment, and community friendliness.

“Reflecting on this,  we need cooperation and innovation from both the private sector and government, when it comes to meeting the demand for green hydrogen. This involves transformation and transition of economic values to environmentally friendly and green, high market demand to encourage investment, as well as a direction map and regulatory policies to support national transformation and transition,” Farid said. 

Indonesia, said Farid, can learn from other countries that have implemented green hydrogen. For instance, Fortescue Australia faced challenges in funding 550 MW electrolyzer capacity on Gibson Island due to high investment and electricity costs for utilizing hydrogen as an ingredient of ammonia. Some of the issues encountered include high investment and operational costs, limited government subsidies, and the high price of ammonia as a fertilizer.

“To minimize the occurrence of unwanted events in the use of green hydrogen, we need to take strategic steps. First, standardization and certification, which is important to maintain the value of a safe and controlled supply chain. Second, the establishment of policy direction maps and regulations that support the development of green hydrogen in Indonesia. Third, access to resources, especially related to defense, determines the cost efficiency of investment, energy, and mobility. Fourth, the availability of hydrogen utilization technology, in building a domestic market for sustainable utilization. Fifth, potential markets, especially for global export markets, have high selling points and domestic markets. Sixth, financial support such as the provision of binding incentives and disincentives,” Farid explained. | Story of Cooperation from Kuningan Using Renewable Energy, Transforming Cow Dung into Biogas and Installing Solar Power Plants

Who would have thought that cow dung, which is often considered inferior because it gives off an unpleasant aroma, could be transformed into biogas. Karya Nugraha Jaya Cooperation in Kuningan has successfully utilized cow dung into biogas which is used as production fuel.


Industry’s Role in a Clean Future

Bandung, January 25, 2024 – Indonesia is blessed with abundant natural resources and committed to achieving the Net Zero Emission (NZE) target by 2060 or earlier. The industrial sector is crucial in this energy transition towards a sustainable future. Based on data from the Ministry of Industry (MoI), greenhouse gas (GHG) emissions from the industrial sector in Indonesia reached 238.1 million tons of CO2 in 2022. 2015-2022, it reached 8-20% of the total national GHG emissions. The most significant contributor to emissions comes from industrial energy use. 

Reflecting on these conditions, the West Java Energy Exploration team continued to visit several industries on the third day to see the utilization of renewable energy. PT Kahatex, PT Surya Energi Indotama, and Pertamina Geothermal Energy Area Kamojang show how industry can be central in utilizing renewable energy.

Reducing Emissions from the Garment Industry Production Process with Renewable Energy

The apparel and garment industry, particularly those involved in the global brands’ supply chain, must improve their production processes. The Carbon Border Adjustment Mechanism (CBAM) requires the industry to measure the carbon emissions produced during manufacturing.

Dedi Supriadi, Sustainability Compliance of PT Kahatex Majalaya, mentioned that the textile industry is competing with international brands to reduce emissions and increase the use of clean energy technology.

“From 2021, we (Kahatex Majalaya, red) installed rooftop solar power plants as much as 15% of the installed power capacity. From installing this solar PV, we managed to reduce emissions by around 40%-50% from 7,567e-1 CO2/unit to 3,190e-1 CO2/unit,” explained Dedi.

Kahatex has significantly reduced its greenhouse gas emissions and is now looking into utilizing other renewable energy sources to reduce its carbon footprint further. Since 2022, the company has been exploring biomass as a source of heat energy, which involves co-firing with coal. Since 2023, PT Kahatex Majalaya has been using 100 percent biomass to meet its heat energy requirements for production.

Solar Energy Illuminates the Earth of Indonesia

Director of Engineering & Operations, PT Surya Energi Indotama (SEI), Fajar Miftahul Falah, explained that SEI, as a subsidiary of PT Len Industri (BUMN), is responsible for developing renewable energy, particularly solar energy. Fajar stated that the business itself was the most significant challenge SEI faced since its establishment. Many people doubted its existence as a solar company at the beginning of its establishment. The high price of solar power and the belief that Indonesia was not ready to accept the offer made it even harder. However, with the acceleration of solar energy technology development, the price of solar PV has become more affordable. SEI has been in the solar power plant industry for over 15 years, with a total installed capacity of over 60 MW throughout Indonesia.

“Approximately 70% of the solar power plant construction projects we are currently working on are situated in Disadvantaged, Frontier, and Outermost (3T) areas or areas near them. Solar PV in these areas is challenging due to difficult terrain, making it hard to access the sites and creating safety concerns,” said Fajar. 

Operational room on PT SEI

Fajar mentioned that building solar PV in the 3T area is costlier than in other regions like Java. However, many believe the cost is the same in all areas. The fact is, while solar PV is affordable, the budget required to build it is expensive.

“We have been working on several solar PV projects, such as the Nusa Penida hybrid solar PV in Bali with a capacity of 4.2 kWp, the Merak Executive Terminal rooftop solar PV with a capacity of 324 kWp, and the Bakauheni Executive Terminal rooftop solar PV with a capacity of 192 kWp. Our main focus is on renewable energy, and we hope to contribute to Indonesia’s goal of achieving the NZE target by 2060 or earlier,” Fajar said.


Geothermal to Reduce Emissions

Raindrops welcomed the team from Jelajah Energi West Java upon their arrival at PT Pertamina Geothermal Energy (PGE) Kamojang Area. PGE is a PT Pertamina (Persero) subsidiary under the Upstream Directorate, which manages geothermal energy production from exploration activities to steam and electricity generation. The Kamojang geothermal energy sources are located in Ibun District, Bandung Regency, West Java, surrounded by beautiful pine forests.

Yustinar Uli, a representative of the PGE team, explained that PGE Kamojang Area became a pioneer of geothermal exploitation in Indonesia with the drilling of the first geothermal exploration well by the Dutch in 1926-1928. PGE Kamojang Area began operations on January 29, 1983, marked by the PLTP Unit 1 Kamojang operation.

“PGE constructed several units leading up to the PLTP Kamojang Unit 5 operation in 2015. Currently, PGE operates PLTP Kamojang Units 4 and 5 with a capacity of 60 MW and 35 MW, respectively. Meanwhile, PLTP Kamojang Units 1, 2, and 3, which have a combined capacity of 140 MW, are operated by PLN,” said Yustinar. 

Yustinar reported that the geothermal plants in the Kamojang area have a total installed capacity of 235 megawatts (MW). This is equivalent to reducing CO2 emissions by 1.2 million tons annually. The electricity generated from these plants is absorbed by PT PLN and distributed through the Java Madura Bali (Jamali) electricity interconnection system.

Civil Society Recommendations for the Development of Indonesia’s Second NDC

press release

Jakarta, February 2, 2024 – Indonesia, under the coordination of the Ministry of Environment and Forestry (MoEF), has initiated the drafting process for its Second National Determined Contribution (SNDC) aimed at emissions reductions by 2030 and 2035. The MoEF intends to submit the SNDC to the UNFCCC in 2024.

The Institute for Essential Services Reform (IESR) along with several civil society organizations have requested for revisions in the SNDC, proposing updated scenarios and targets aligned with the objective of limiting global warming to below 2 degrees Celsius. They advocate for striving to achieve the ambitious goal of 1.5 degrees Celsius, as set forth by the Paris Agreement and reinforced by the Global Stocktake decision at COP 28.

IESR also urges the government to engage public participation in the preparation process of the SNDC. Furthermore, it is essential for the government to adhere to the principles outlined in Article 4, Line 13 of the Paris Agreement and the provisions of the COP series during SNDC preparation.

Currently, the government continues to utilize the business-as-usual (BAU) scenario for calculating emission reductions. However, civil society deems this scenario irrelevant as a basis for emission calculations. Indonesia must transition to a more accurate calculation system that references relative emissions in a given year, considering a realistic trajectory of global and Indonesian economic growth.

“While the emission reduction target in the Enhanced NDC (ENDC) appears to be increasing, it still does not align with the goal of limiting temperature rise to 1.5 degrees Celsius. Presently, the ENDC target only aims for a 31-43 percent reduction below BAU. If using the BAU calculation method employed thus far for setting emission reduction targets in the NDC, Indonesia’s target should be at least a 60 percent reduction from BAU for unconditional efforts and a 62 percent reduction from BAU for conditional efforts with international assistance. These figures do not include emission reductions from the agriculture, forestry, and land sectors,” remarked IESR Executive Director Fabby Tumiwa.

According to the analysis conducted by IESR, using 2022 emissions as the benchmark for target setting, Indonesia must establish an unconditional emissions reduction goal of 26 percent, equivalent to 859 MtCO2e by 2030, and a conditional reduction target of 28 percent, amounting to 829 MtCO2e with international assistance. These targets are crucial for contributing to the objective of limiting temperature rise to 1.5 degrees Celsius.

In addition to increasing emission reduction targets, Indonesia must also diminish the reliance on fossil energy sources such as coal and gas within its energy system. Based on calculations from the Climate Action Tracker (CAT), the coal component in Indonesia’s electricity system should be reduced to 7 to 16 percent by 2030, with the phasing-out of PLTU operations before 2040. Similarly, gas usage needs to be curtailed to 8 to 10 percent by 2030, with phasing-out operations by 2050.

Deon Arinaldo, IESR’s Energy Transformation Program Manager, emphasized that the reduction in the fossil energy mix should be accompanied by an increase in the share of renewable energy, ranging from 55 to 82 percent by 2030. However, it is worth noting that the target listed in the ENDC pertains to the installed capacity of renewable energy rather than the actual mix. IESR contends that solely focusing on installed capacity does not adequately reflect the relationship with emission reduction objectives.

“With the clarity of the renewable energy mix target in the electricity sector, it becomes possible to anticipate and even calculate the emission intensity of the electricity sector by 2030 to achieve the SDNC target. Furthermore, a significant presence of renewable energy will offer a clearer roadmap for electricity planning, specifying the types of renewable energy that should be prioritized to bridge the existing gap. With only 7 years remaining, it’s evident that solar and wind power plants, known for their shorter construction periods, should take precedence in development efforts to meet the mix target. Additionally, interventions are necessary for fossil fuel power plants, emphasizing the importance of reducing the reliance on fossil energy through various strategies such as terminating the operation of PLTU or reducing its utilization,” stated Deon.

Furthermore, IESR and other civil society organizations criticize the ENDC document for neglecting to incorporate the principle of climate justice. Civil society advocates for the SNDC preparation process to be more inclusive, ensuring climate protection for vulnerable groups and transparency throughout.

Wira Swadana, IESR Green Economy Program Manager, emphasized that the government must ensure fair distribution of the burden of emission reduction.

“Entities responsible for the highest emissions must shoulder a larger portion of the emission reduction efforts. Furthermore, the formulation of the SNDC should prioritize the principle of climate justice, which aims to mitigate both short-term and long-term risks while ensuring fair distribution of benefits, burdens, and risks, particularly for marginalized communities,” remarked Wira.

IESR and other civil society groups have outlined six recommendations for the preparation of the SNDC. First, the government should adhere to the principles of the Paris Agreement as outlined in Article 4, Line 13, and the guidelines set forth by the COP. Second, there should be a focus on integrating measurement, reporting, and verification (MRV) systems tailored for developing country parties. Third, the government should abandon the use of the BAU scenario as the basis for emission reduction calculations and instead adopt a method based on relative emissions in a given year, which takes into account more precise global and Indonesian economic growth projections. Fourth, climate targets should be established in alignment with the Paris Agreement. Fifth, there should be transparent and publicly accessible monitoring and evaluation mechanisms put in place. Sixth, principles of climate justice should be incorporated and implemented throughout the process. These recommendations for the preparation of the Second NDC have been submitted to relevant ministries and institutions.

Exploring the Benefits of Renewable Energy in Tanah Pasundan

Bandung, January 24, 2024 – Renewable energy promotes sustainability and minimizes environmental impacts. In West Java, Indonesia, there is a growing focus on increasing the usage of renewable energy. According to the Energy and Mineral Resources Agency (ESDM) of West Java Province, the region has a renewable energy potential of 192 GW (gigawatts).

The West Java Provincial Energy and Mineral Resources Office, in collaboration with the Institute for Essential Services Reform (IESR), organized a four-day event named West Java Energy Explore from January 23 to January 26, 2024. The purpose of this event was to closely examine the renewable energy developments in the industrial and community sectors in Central Java. On the event’s second day, the group visited two renewable energy plants owned by PT PLN Nusantara Power. Later, the group went to PLTMH Gunung Halu in West Bandung Regency to visit a village.

Hydropower and Solar PV: Two Renewable Energy Sources that Complement Each Other

Cirata Hydroelectric Power Plant is one of the hydroelectric power plants that contributes significantly to providing clean energy in West Java. Ristanto Handri W, Senior Officer of PJB UP PLTA Cirata, explained that the plant has a 500 kV Java Madura Bali interconnection transmission system.

“This hydropower plant, built in the 1980s, has eight power plants with a total capacity of 1,008 megawatts (MW). This hydropower plant is the largest in Indonesia and second in Southeast Asia (after hydropower plants in Vietnam, ed),” said Ristanto.

Meanwhile, Cirata Floating Solar Power Plant (Solar PV) proves solar energy can be integrated into West Java’s energy portfolio. Dimas Kaharudin, Operations Director of PT Pembangunan Jawa Bali Masdar Solar Energy (PMSE), said that the Cirata floating solar power plant has an electricity production capacity of 192 megawatt peak (MWp) and has the potential for additional capacity up to 1000 MWp. 

“To keep the solar panel islands from moving, we use anchors. Each island requires 150 anchors located on the edge of the island. One island can produce up to 15.7 MWp. This solar PV proves that clean energy can compete economically with fossil energy,” Dimas said.

Dimas emphasized that a combination of hydropower and solar power plants in one area, such as the Cirata Floating Hydropower and Floating Solar Power Plant managed by PT Pembangkit Jawa Bali (PJB), can maintain a stable electricity supply.

“During the dry season, hydropower plants tend to have low production, whereas the solar power plants have high production. Conversely, during the rainy season, solar power plant production decreases while hydropower production increases. As a result, we can maximize its benefits by utilizing renewable energy in Cirata during both seasons,” Dimas said.

Gunung Halu Microhydro: Empowering Micro Energy for Local Communities

Local wisdom encourages understanding the surrounding natural patterns that have proven to empower the community, for example, in Tangsijaya Village, Gununghalu Village, Gununghalu District, West Bandung Regency, West Java. The residents of this village use and process river currents to generate electrical energy through the Micro Hydro Power Plant (PLTMH).

The operator of Gunung Halu Hydro, Toto Sutanto, explained that this Gunung Halu Micro Hydro has a capacity of around 18 kWh, which can provide electricity to 80 houses in Tangsijaya Village. Not only does the electrical energy from the micro hydro provide electricity for dozens of homes, but it also supports the operation of the coffee factory, which is the center of the village’s economy.

“We utilize the river water discharge of 400 liters/second and a head of 8 meters. The electricity generated from the micro hydro is channeled to residents’ homes, which are only charged Rp 25,000 per month. Meanwhile, public facilities, such as schools and mosques, as well as the homes of elderly residents, are not charged for electricity,” said Toto.