Indonesia’s energy transition is an opportunity for S. Korea to terminate coal plant assets

Jakarta – Indonesia’s energy transition journey towards decarbonisation allows South Korea to retire coal-fired power plant assets owned by Korean companies. The move will also increase the opportunity for investment in renewable energy, clean technology, energy storage, and electric vehicles.

This was conveyed by the Executive Director of the Institute for Essential Services Reform (IESR), Fabby Tumiwa, in the Indonesia – South Korea Golden Jubilee webinar: Advancing Bilateral Cooperation through Green Energy Partnership Toward Sustainable Energy Transition, Thursday, 25 July. Furthermore, Tumiwa argued that with the agreement of the Just Energy Transition Partnership (JETP), Indonesia needs to achieve one of the renewable energy mix targets of 34% in 2030. This can be achieved, among others, by gradually ending the operation of coal power plants until 2050.

“South Korea has set a target to become carbon neutral by 2050. In addition to encouraging the achievement of the target domestically, South Korea has also committed, through the New South Korea Green Deal Policy, to support the financing and development of green technologies internationally,” said Tumiwa.

IESR views South Korea’s green commitment as an opportunity for Indonesia to accelerate the country’s energy transition, especially in ending the operation of coal-fired power plants.

Meanwhile, Hyoeun Jenny Kim, Ambassador and Deputy Minister for Climate Change, Republic of Korea, who was present on the occasion, said that the presence of Indonesia and South Korea in various initiatives that encourage greener development will strengthen solidarity towards climate change mitigation. She said negotiations are underway between Indonesia and South Korea to work closely on climate change mitigation. Among others, in the form of studies, policy changes, technology development and private sector involvement.

“In both countries, coal is still the main source of energy, we must accelerate efforts to reduce coal use. We should proactively invest in more renewable energy, energy efficiency, and energy storage,” said Hyoeun.

Joojin Kim, Managing Director of Solution for Our Climate (SFOC), said there is strong potential for Korea and Indonesia to build a green economy aligned with the Paris Agreement.

“Banks in South Korea are very interested in investing in renewable energy in Indonesia, especially solar and wind power. However, it is very important to have a policy framework that encourages a more stable and transparent investment environment,” said Kim. (Hartatik)

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