Jakarta—Accelerating Indonesia’s energy transition, including the retirement of aging coal-fired power plants (PLTU), is seen as more beneficial than continuing to maintain costly old plants. According to some analysts, investing in clean energy infrastructure and smart grids will have a positive impact in the long run on the economy, environment, and health.
Bhima Yudhistira, Executive Director of the Center of Economic and Law Studies (CELIOS), considers that efforts to maintain old PLTUs will result in more losses than benefits.
“Maintaining an inefficient PLTU will only drain the state budget. Meanwhile, investment in renewable energy infrastructure such as smart grids saves energy subsidy costs, improves quality of life, and supports the net zero emission target by 2060,” said Bhima Wednesday, November 6.
According to Bhima, improving infrastructure to support clean energy should not be seen as a burden but as a strategic investment. He added that health costs due to pollution from power plants and increasing subsidies can be avoided by accelerating the transition to clean energy.
“This is not just an expense, but a future investment that will produce far greater economic benefits.”
Potential state losses by maintaining old PLTUs
The government’s decision to accelerate the early retirement of PLTU also received support from various environmental organisations. Leonard Simanjuntak, director of Greenpeace Indonesia, emphasised that the costs incurred to maintain the old PLTU are a form of state loss in a broader context.
“It’s not just about the numbers in the state budget, but also about the impact felt by the community around the PLTU, such as poor air quality and increased health risks. So, the best option is to invest in clean energy and environmentally friendly technologies,” Leonard said.
He also added that the government should consider the examples of other Southeast Asian countries that have started to shift their investments to the renewable energy sector and smart grid technology.
“Vietnam, for example, has allocated a lot of funds to improve transmission that supports renewable energy. The impact is reduced consumer costs and increased national energy stability,” Leonard said.
The development of smart grids in Indonesia is one important element in accelerating the energy transition and creating long-term energy security. Tata Mustasya, Executive Director of Sustainable Prosperity Indonesia (Sustain), stated that smart grids not only improve the efficiency of energy distribution but also strengthen the clean energy sector in Indonesia.
“Investing in smart grids and renewable energy is a step towards energy security and mitigating the impacts of climate change. It is a much more profitable investment than maintaining power plants,” Tata said.
In addition, Tata emphasised the importance of downstream renewable energy technology, particularly through the development of batteries and solar energy.
“Downstreaming can increase economic added value and create many jobs. This is a real step towards making Indonesia a major player in the global clean energy industry,” he added.
Apart from the economic aspect, various community groups also support the early retirement of PLTU. Adhinda Maharani Rahardjo, Coordinator of the People’s Coalition to Clean Cirebon (Karbon), highlighted the negative impact of the PLTU on the community around its operational area. “For years, surrounding communities have felt the adverse effects of air pollution, impacting their health and livelihoods. These are real losses that the government should not overlook in considering the energy transition,” Adhinda explained.
Adhinda added that the energy transition is not just about changing energy sources but also about improving people’s quality of life and maintaining environmental sustainability.
“The people of East Cirebon, for example, have long experienced the direct impact of PLTU operations, and this transition can provide them with a healthier environment and a cleaner future,” she added. (Hartatik)
