Jayanty Nada Shofa, Jakarta – The Indonesian government is seeking to have the House of Representatives' approval on the renewables bill by this September, as the Southeast Asian country aims to drastically reduce its coal reliance.
"We are currently working on the renewables policy. We have submitted it to the House and the government has also informed them of the 'inventory of issues'. I happen to be leading the working committee [for this bill]. Our goal is to have this bill completed by September," Dadan Kusdiana, the renewables director-general at the Energy and Mineral Resources Ministry, said at the 2023 Economic Outlook forum hosted by B-Universe Media Holdings in Jakarta on Tuesday.
The bill has 574 of the so-called "inventory of issues" which lists the matters that would be discussed by the House prior to approval. The House to date has discussed 160 of the said 574 issues, according to Dadan. This means that the bill's progress is standing at about 27 percent.
"The renewables bill will cover a myriad of things, including the obligations and sanctions. So basically, the carrots and sticks," Dadan said.
The government will focus on a number of aspects in this bill, among others, the management of renewable energy funds. Other aspects that the government finds strategic include integrated nuclear energy management.
Indonesia is aiming to have 23 percent of renewables in its energy mix by 2025. But the government data showed the renewables share only stood at 12.3 percent in 2022, up by only 0.1 percent from a year earlier. Volume-wise, renewable energy consumption reached 213.8 Mboe in 2022. This marks an 18 percent increase from 180.5 Mboe in 2021, according to the Ministry.
Coal to this day is still taking the lion's share in Indonesia's primary energy consumption. The combustible black rock represents 665 Mboe out of last year's primary energy consumption, which totaled 1,734 Mboe.
Having updated its nationally determined contribution (NDC) targets, Indonesia is now aiming to slash emissions by 31.89 percent independently by 2030. The target will rise to 43.2 percent if it receives international assistance.
Indonesia has committed to reaching net zero emissions by 2060 or sooner. The government's estimates show that the country would need a total of $1,108 billion in investment to reach that 2060 target. In other words, about $28.5 billion a year until 2060.
A coalition of wealthy nations at Bali's G20 forum last year launched a $20 billion financial package to support Indonesia's shift from coal. Under this Just Energy Transition Partnership (JETP) deal, the member states of the International Partners Group (IPG) – co-led by the US and Japan – will put in $10 billion. The remaining $10 billion will come from the Glasgow Financial Alliance for Net Zero (GFANZ), a global coalition of financial institutions.
"The JETP will set up a secretariat here [in Indonesia]. We will discuss what the $20 billion will be used for and how much of that money will be in loans, grants, or technical assistance. We are finalizing these matters," Dadan said.