The Institute for Essential Services Reform (IESR) encourages the government to review the clauses contained in the power purchase agreement (PJBL) between PT Perusahaan Listrik Negara (Persero) or PLN and private power developers or independent power producers (IPP).
The Institute for Essential Services Reform (IESR) revealed to meet the target of generating 328 megawatts (MW) of electricity from green hydrogen plants by 2030, Indonesia would need around US$800 million worth of investment. Meanwhile, to boost the generating capacity of green hydrogen plants to 52 gigawatts (GW) by 2060, Indonesia would need up to US$25 billion.
The energy transition towards renewable energy is roaring in the momentum of the G20 2022. It’s because the Indonesian Government places the energy transition as one of the priority issues under its leadership at the G20. Furthermore, its coverage in the mass media, using the keyword “energy transition” on Brandwatch.com, increased from 346 in 2017 to more than 79.000 in 2022.
The Institute for Essential Services Reform (IESR) continually strives to contribute to popularizing the energy transition with various studies and advocacy activities. One of them published its main report, which encourages and measures the energy transition process in Indonesia, entitled Indonesia Energy Transition Outlook (IETO). Published annually since 2017, IETO 2023 is the 6th volume. Previously, this report was titled Indonesia Clean Energy Outlook in 2017 but changed its name to Indonesia Energy Transition Outlook in 2020.
The launch of the IETO was welcomed by various parties, including journalists in the mass media, who have a significant role to play: collecting and distributing the correct information.
Sugiharto, an ANTARA journalist, said that the IETO is a critical report that is getting better from year to year and has become a reference in journalistic writing because it contains various data and information about Indonesia’s energy transition program.
“With the IETO report with complete data, we as journalists quite often use it as a writing reference, especially regarding the diversity of data outside the government,” explained Sugiharto.
On the other hand, Sugiharto assessed that Indonesia’s energy transition development has been moderate. Even though Indonesia has a lot of renewable energy potential, that is exceptionally qualified to meet domestic energy needs. Regulatory and funding barriers are challenges for developing the energy transition in Indonesia that need to be overcome.
“Based on the low renewable energy mix, the government needs to be aggressive in realizing Indonesia’s energy transition ambitions,” said Sugiharto.
Aditya Putra, a journalist for Kompas Daily, explained the IETO, which outlines the challenges of the energy transition in Indonesia and the strategic steps in the future. Moreover, Aditya stated that these topics are interesting to be known by the public.
“The data presented in the IETO can earn attention on energy transition, including those that journalists may have missed or not disclosed regularly to the public by the Government, for example, regarding the declining mix of renewable energy in primary energy. Getting further away from the target that has been set, “explained Aditya.
In this regard, Aditya hopes that the existence of reports such as IETO 2023 can oversee the commitment and implementation of the Government’s energy transition agenda and plans. In line with Aditya, Vindry Florentin, a journalist for Koran Tempo, stated the integration of comprehensive data discussing the energy transition in the IETO report became a reference for the media. Moreover, said Vindry, the data shared by the Government needed to be completed and integrated.
Efri Ritonga, a senior journalist for Koran Tempo, also said that the development of energy transition in Indonesia continues currently, although it is still slow. Moreover, there are some community initiatives to initiate an energy transition. Such as the use of rooftop solar in residential areas, as well as the development of large-scale renewable energy, are still constrained. In addition, using fossil fuels is still dominant because of price, availability, and affordability. Some people are unfamiliar with the issue of the energy transition.
“There are several reasons the issue of the energy transition is not well known in the broad community. First, there is not much information about energy transition practices that people can start themselves with, for example, by using an electric stove, installing a rooftop PLTS, reducing the use of private vehicles made of fossil fuels, or switching to electric vehicles. Second, in terms of practicality and cost. For example, in the transportation sector, the price of electric cars is still prohibitive, and the availability of charging stations is still minimal,” said Efri and Vindry.
Based on data from the Indonesia Energy Transition Outlook published by IESR, the adoption of electric vehicles will indeed increase in 2022. Electric motorbikes, for example, have increased fivefold from 5,748 units in 2021 to 25,782 units this year. The adoption of electric cars has almost quadrupled from 2,012 units in 2021 to 7,679 units in 2022.
Based on the 2023 Indonesia Energy Transition Outlook (IETO) report issued by the Institute for Essential Services Reform (IESR), in 2022, the renewable energy mix dropped to 10.4 percent compared to 2021, which was 11.5 percent. The government has set a target of 23 percent by 2025.
(Jakarta, 12 January 2023) – By definition, the energy transition is an effort to change the energy supply from previously a coal-dependent source to cleaner energy. This is the effort that the Indonesian government continues to pursue to achieve national energy security and autonomy. However, there are still many tasks that must be fulfilled by the Indonesian government.
Handriyanti Diah Puspitarini, Research Manager of the Institute for Essential Services Reform (IESR) in the Ruang Publik KBR talk show: Energy Transition in Indonesia, How Far We’ve Come organized by Berita KBR (10/01) explained that the IESR report on energy transition monitors public readiness through surveys and government readiness through research.
“Bottom-up side has supported the procurement of cleaner energy, but based on the transition readiness framework studied in the Indonesia Energy Transition Outlook 2023, the government (top-down) still has many things to improve, especially in terms of commitment and regulation,” Handriyanti said.
Meanwhile, on the same occasion, Raden Raditya Yudha Wiranegara, IESR Senior Researcher stated that from the fossil fuel side, the government has not yet paid attention to carbon emissions produced by mining, oil and gas industries.
“The government only monitors carbon dioxide (CO2) emissions, which only has a fraction of methane’s heat-trapping ability, around 29-30 times less. If there is a reduction in methane gas by only 30%, it will help abate the temperature rise by 0.5°C,” said Raditya.
Handriyanti and Raditya then discussed the upward trend of buying electric vehicles. The high price then led to the government’s proposal for subsidizing these vehicles, which is expected to stimulate public demand and lower the price of electric vehicles eventually.
However, according to them, there are several points of public resistance regarding the energy transition and the use of electric vehicles. The first is the view that fossil fuels are cheaper than renewable energy.These prices are the result of government intervention in the form of price capping, subsidies and compensation. This will surely burden the state budget when global oil prices rise. Second, there is range anxiety, which means the fear of electric vehicles inability to travel long distances.
“The government then has to work around this by increasing the number of charging stations at rest areas in-between journeys,” said Raditya.
Handriyanti and Raditya discuss the government’s progress and tasks in the matter of energy transition from a techno-economic, regulatory and funding perspective. They said that the price of renewable energy technology is becoming more affordable every year, for example, the price of solar modules is 70% cheaper than 7-10 years ago and is predicted to decrease even more. Supporting Regulations such as Presidential Regulation No. 112/2021 which stipulate ministers to make a roadmap for retiring coal-fired power plants (CFPP) needs to be supported. However, the implementation of this regulation still needs to be monitored and improved, especially considering that coal and fossil funding is currently still 10 times larger than renewable energy funding.
“The presence of international forums such as the G20 has encouraged Indonesia to make commitments towards energy transition and attract financing for those efforts. It is hoped that this financing can help Indonesia achieve its target of a renewable energy mix of 23% by 2025,” they concluded.
The Institute for Essential Services Reform (IESR) notes that an investment of US$ 800 million or Rp 12.46 trillion is needed to achieve the target of a green hydrogen production capacity of 328 megawatts (MW) in early 2030.
The Executive Director of the Institute for Essential Services Reform (IESR), Fabby Tumiwa, stated that mandatory green industry standards (SIH) must be oriented towards increasing Indonesia’s export competitiveness.
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