Jakarta—Indonesia must immediately take concrete steps to reduce the capacity of coal-based power plants (PLTU) if it wants to achieve the net-zero emissions (NZE) target by 2050. The Institute for Essential Services Reform (IESR) considers reducing PLTU capacity by 11% by 2030 a crucial first step.
“This reduction is important to open up space for greater penetration of renewable energy in our energy mix. By 2030, renewable energy is expected to reach 40% in the primary energy mix of the electricity sector,” said IESR Executive Director Fabby Tumiwa on Thursday, November 21.
“The government needs to immediately finalise this roadmap, as Presidential Regulation No. 112/2022 mandated. In addition, we suggest the formation of a cross-ministerial electricity decarbonisation task force that reports directly to the president,” he added.
Fabby emphasised that phasing out coal-fired power plants will require significant investment. By 2050, Indonesia will need USD 1.2 trillion to develop renewable energy storage and transmission networks.
“This transition also requires additional costs to close PLTU operations early, especially those managed by the private sector with long-term contracts. Blended finance and carbon credits can be a solution to support this funding,” Fabby said.
IESR’s Energy Transformation System Program Manager, Deon Arinaldo, added that early retirement of coal-fired power plants also brings huge health benefits. IESR’s study shows that retiring coal-fired power plants by 2040 could prevent up to 182,000 premature deaths from air pollution and reduce the burden of health costs by USD 130 billion (around Rp1,900 trillion).
“In addition, around 4.5 GW of old and inefficient coal-fired power plants can be retired immediately. This will reduce emissions by 28.8 million tons of CO2 per year and improve air quality and public health,” Deon explained. (Hartatik)
