Ico energy Indonesia

Is Indonesia's energy transition progress stalled in 2024?

Jakarta, December 5, 2024 – The progress of Indonesia’s energy transition throughout 2024 has stalled. The government’s move to revise the National Energy Policy has actually lowered the target for achieving renewable energy from 23% to 17-19 percent in 2025. Indonesia’s energy transition status has not moved from the consolidation stage.

What is Indonesia's energy supply?

Exports of coal and natural gas make up nearly 20% of net goods exports. Indonesia’s total energy supply increased nearly 60% from 2000 to 2021. As energy demand rose, coal stepped in to fill the gap. Per unit of energy consumed, its energy sector now emits one-third more CO 2 than in 2000.

What is Indonesia's national electricity plan?

Added to this, Indonesia’s National Electricity Plan sets out rules only for its power sector development, and not for renewable energy. There is a Renewable Energy Bill in the pipeline, but the bill has yet to be ratified. Without clear guidelines, investors remain cautious.

How has Indonesia's Energy Supply changed in 2021?

Indonesia’s total energy supply increased nearly 60% from 2000 to 2021. As energy demand rose, coal stepped in to fill the gap. Per unit of energy consumed, its energy sector now emits one-third more CO 2 than in 2000. Total energy sector emissions have grown faster than energy demand, more than doubling over the last two decades.

Should we celebrate Indonesia's energy transition?

Although Indonesia’s recent energy transition looks bleak, we should celebrate every small step the country has taken to reduce fossil fuel use and replace it with clean energy to protect future generations from the catastrophic consequences of climate change.

Should renewables be installed in Indonesia?

Indonesia already has fossil fuel power generation assets. If renewables are installed at scale, the profitability of those existing assets decreases. Furthermore, the age of the assets influences the amount that would need to be written off against how much more the asset might otherwise have produced.