Indonesia will continue to build new coal-fired power plants despite a recent $20 billion deal with the G7 nations to help the country transition to clean energy.
Under the deal - the largest single climate finance partnership to date - Indonesia will aim to limit emissions from its power sector by 2030, faster than the initial 2037 target, and generate 34% of its electricity from renewable sources by 2030.
But the Indonesian government will still allow the construction of new coal power plants with a total capacity of 13 GW, which have been put out to tender. The plan is set out in the country's 10-year energy plan for the period 2021-2030. Most importantly, a regulation issued by President Joko Widodo in 2022 gave the green light for the construction of so-called captive coal plants, which are built specifically to supply certain industries and do not feed into the grid.
In a joint statement, Indonesia and its JETP partners, which include the G7 plus Denmark and Norway, said they have a goal of limiting the development of captive coal-fired power plants under a 2022 presidential regulation.
In 2019, Indonesia is the world's fifth largest emitter of greenhouse gases, behind China, the United States, India and the entire European Union. Its emissions come mainly from deforestation and coal combustion, the latter generating 61% of the country's electricity.
Emissions from Indonesia's power sector are expected to increase as the country's economy grows, making it the largest country in Southeast Asia and the 17th largest in the world in terms of nominal GDP.
In particular, captive coal use in industrial parks is expected to increase by 9.5 GW to supply the country's mineral processing industry, including nickel used in electric vehicle batteries.
(Writing by Alex Guo Editing by Tammy Yang)
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