Driving Energy Transition: Indonesia Ready for Net Zero Emissions by 2060

Jakarta, INTI - Indonesia is taking significant steps towards achieving Net Zero Emissions by 2060 with various efforts to reduce greenhouse gas emissions. In the Enhanced Nationally Determined Contribution (ENDC), Indonesia is committed to reducing greenhouse gas emissions by 31.89% by 2030 through domestic efforts, and up to 43.20% with international support. This commitment is an essential part of the global strategy to combat climate change.

Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated during the National Seminar on Renewable Energy and Energy Transition and the National Working Meeting of the Mechanical Engineering Agency of the Indonesian Engineers Association (BKM-PII) at Gunadarma University, Depok, on Thursday (29/08), that innovation in renewable energy and energy transition must be accelerated. "Energy is the main contributor to greenhouse gas emissions in Indonesia, accounting for 34% of total emissions," he explained. "This green transition is one of the most effective steps to address this issue."

In line with this commitment, the Indonesian government has issued Presidential Regulation No. 98 of 2021 on the Carbon Economic Value (NEK), allowing carbon trading as one way to reduce greenhouse gas emissions. In February 2023, the government launched the Emission Trading System (ETS) in the power generation sector, followed by the launch of the Carbon Exchange (IDX Carbon) in September 2023. Through this mechanism, it is hoped that greenhouse gas emissions can be reduced by up to 100 million tons of CO2 equivalent by 2030.

Further efforts include the proposed early retirement for coal-fired power plants (PLTU) with funding from the Just Energy Transition Partnership (JETP). At the G20 Summit in Indonesia 2022, Indonesia successfully secured a funding commitment of USD 21.6 billion to support the energy transition.

Indonesia also plays an active role in the Asia Zero Emission Community (AZEC), an initiative co-founded with Japan to promote energy transition across Asia. Airlangga Hartarto explained that Indonesia and Japan serve as chair and co-chair in AZEC. During the second ministerial meeting in Jakarta recently, 34 projects from Indonesia were identified as part of 78 energy transition projects across Asia. These projects are expected to receive funding from JETP through AZEC.

The Mandatory Biodiesel program is also a highlight of Indonesia's energy transition efforts. The successful B35 Mandatory program has been recognized globally, and Indonesia is now preparing to implement the B40 Mandatory program in January 2025. Additionally, Coordinating Minister Airlangga mentioned that Indonesia is developing Sustainable Aviation Fuel (SAF) to meet 5% of domestic aviation fuel needs, aiming to become the largest supplier in ASEAN.

The development of hydropower is also a priority for the Indonesian government, with a target capacity approaching 10 gigawatts. Coordinating Minister Airlangga emphasized that the support of various parties, including the Indonesian Engineers Association (PII), is crucial in making this energy transition a success. "We need more engineers, especially in science, technology, engineering, and mathematics, to support digitalization and the future industry," he stressed.