Jakarta, July 4, 2024 – Indonesia government needs to accelerate the energy transition by shifting from reliance on emission-intensive fossil fuels to renewable energy to significantly reduce emissions in the energy sector and achieve net zero emission (NZE) target by 2060 or sooner. Indonesia can learn from the experience of countries like Norway, which have reduced dependence on fossil fuels and nearly achieved 100 percent renewable energy in the electricity sector. Therefore, the Indonesia Clean Energy Forum (ICEF), in collaboration with the Institute for Essential Services Reform (IESR) and the Royal Norwegian Embassy, organized the “Norway and Indonesia Energy Seminar and Business Exchange on Green Transition”(07/02/2024) to share lessons learned, opportunities, and challenges in accelerating the energy transition.
Terje Aasland, Norway’s Minister of Energy, stated that the Norwegian government, as a member of the International Partners Group (IPG) for the Just Energy Transition Partnership, strongly supports Indonesia’s ambitious emission reduction goals to achieve the NZE target. He emphasized that in addition to implementing stringent policies and frameworks on greenhouse gas emissions and environmental standards, it is also essential to highlight the core role of companies in recognizing opportunities for green and sustainable solutions.
“Indonesia and Norway have set ambitious NZE targets, with aspirational international goals, such as realizing the goals of the Paris Agreement. I am also excited to see the Indonesian government’s ambition to reach NZE by 2060 or sooner, focusing on the energy sector. To decarbonize energy, Norway is developing new green technologies, such as CCS, hydrogen, and floating offshore wind,” said Aasland.
Prof. Bambang Brodjonegoro, Chairman of ICEF, stated that even though Indonesia relies on coal energy, shifting to renewable energy is essential as Indonesia is committed to the Paris Agreement. He hopes that Indonesia can learn from Norway in managing coal reserves and preparing for a transformation to renewable energy.
“There are at least three things that should be prepared for the energy transition: the development of renewable energy, the building of transmission infrastructure, and becoming a producer of energy storage. With Norway, Indonesia can develop technology, and establish commercial and business partnerships in renewable energy by providing longer-term and lower-cost funding,” Bambang said.
Fabby Tumiwa, Executive Director of IESR, stated that the energy transition has significant implications for the fossil fuel industry, including declining fossil fuel demand and increasing pressure from governments, investors, customers, and society to reduce emissions. It also involves showcasing innovation and staying competitive in the market. Therefore, he emphasized, businesses, particularly in the oil and gas sector, need to mitigate these implications by adjusting their operations and investment strategies to cope with current and future uncertainties in demand and technology.
“To limit the temperature well below 1.5 degrees Celsius, countries must adopt policies and measures to reduce emissions and increase resilience. This includes implementing carbon taxes, subsidizing low-carbon technologies, and phasing out fossil fuel infrastructure. If businesses fail to do so, their reputations will be at risk,” Fabby explained.
