Jakarta – The Indonesian government needs around USD 1 trillion to achieve the energy transition target or net zero emission target (NZE) by 2060, according to the Ministry of Energy and Mineral Resources (ESDM) officials, Tuesday (18/10). This amount of USD 995 billion is needed for renewable energy generation and USD 114 billion for its transmission.
“The need for financial support will increase as we implement early retirement of coal-fired power plants in the coming years,” said Secretary General of ESDM Rida Mulyana in a written statement.
He said the energy transition funding will come from various sources. The support, said Mulyana, will be obtained from blended finance, United Indonesia SDGs, Tropical Landscape Financial Facilities, non-government budget investments as well as government and private partnerships.
Mulyana said, the government must increase mobilisation of all financial sources and strengthen the collaboration of all stakeholders. He said the government will prepare a presidential regulation on accelerating the development of renewable energy for electricity supply. This regulation allows the opening of competitive prices for renewable energy through the transparency of the procurement mechanism and the provision of government support from the relevant ministries. “We also provide incentives such as tax allowances, import duty facilities and tax holidays,” he said.
From the demand side, the government will encourage the use of electric stoves, electric vehicle batteries, biofuels, city gas, the implementation of energy management, as well as the implementation of minimum energy performance standards. “The government will develop 700 giga watts (GW) of renewable energy from solar, hydro, wind, bioenergy, marine, geothermal, as well as hydrogen and nuclear. There is also a strategy to stop coal-fired power plants in stages,” said Mulyana.
He said coal-fired power plants would be discontinued by 2058. In addition, Indonesia plans to build a super grid to maintain the electricity system and open up opportunities to export electricity to ASEAN countries that are connected to the ASEAN Power Grid. (Hartatik)
Banner photo: Ministry of Energy and Mineral Resources, Director General of Electricity Rida Mulyana gave a presentation in the G20 Webinar Series: Achieving Global Energy Access Goals in the Decade of Action, Friday (29/4). (Photo: Hartatik)
