The energy management campaign currently focuses on RE and restricting fossil fuels. — The Jakarta Post
ENERGY security involves ensuring a reliable and affordable energy supply that is free from disruptions so that individuals, businesses and industries always have the energy they need.
This requires diversifying energy sources, maintaining strong energy infrastructure and ensuring political stability.
Energy resilience refers to the energy system’s capacity to endure and recover from disruptions such as natural disasters or cyberattacks, emphasising the system’s ability to adapt, respond quickly and restore normal operations.
Achieving environmental sustainability involves balancing environmental protection such as reducing greenhouse gas emissions with economic growth, biodiversity conservation and the promotion of renewable energy (RE).
Energy policy and management must consider available resources, dependence on external sources, energy supply, pricing, environmental impact and global influences.
Restricting fossil fuels
Indonesia, as part of the global community, is urged to adjust its energy policies toward cleaner energy use, including conservation for environmental preservation and decarbonisation to reduce greenhouse gas effects. The energy management campaign currently focuses on RE and restricting fossil fuels.
This involves various important aspects including global agreement frameworks like the Paris Agreement, which requires countries to submit national plans for emission reduction and increased use of RE as nationally determined contributions.
It also includes international cooperation and partnerships, global funding and investments such as the Green Climate Fund, technology cooperation, innovation collaborations, adaptation and mitigation of climate change impacts.
Indonesia is a major global coal producer, with around 625 million tonnes produced in 2022, mostly from Kalimantan and Sumatra.
Around 130 million tonnes are used for domestic power generation and approximately 40 million tonnes for fuel in the cement, textile and steel industries. Around 75% of Indonesia’s coal is exported, mainly to China, India and Japan.
The country’s total installed electricity generation capacity is around 75 gigawatts (GW), of which approximately 55% comes from coal-fired power plants and 25% from gas-fired and combined-cycle power plants.
Geothermal, wind and solar power plants account for only around 11%, with hydropower and diesel power plants making up the remainder.
Ownership composition is 55% to 60% by state-owned electricity company PLN, with the rest owned by independent power producers (IPPs).
Power plant financing
In financing existing power plants, both PLN and IPPs are bound to and cooperate with banks and financial institutions that adhere strictly to loan repayment targets.
Therefore, it is not easy to immediately switch from coal-fired power plants to RE power plants.
A gradual phasedown is one option. In PLN’s 2020-2030 long-term electricity procurement plan (RUTPL), the government plans to build approximately 19.7GW of new coal-fired power plants and generate 20.9GW from renewable sources for a total of 40.6GW of additional power generation capacity.
The new draft 2023-2033 RUPTL is being designed on careful consideration of global developments, with PLN focusing significantly on RE. The proposal outlines that 75% of new power plant capacity be based on RE sources.
In the National General Energy Plan based on Presidential Regulation No. 22/2017, long-term targets for 2050 aim for 31% RE, 20% crude oil, 25% coal and 24% natural gas.
Unrealistic target
Current proportions in the primary energy mix are approximately 11% to 12% RE, 38% coal, 33% crude oil and 17% natural gas. This means that achieving the 2025 energy mix target is unrealistic.
The government, through the National Energy Council, is therefore drafting a revision of the government regulation to lower the RE target for 2025 to 17%.
For the long term, the proportion of new power plants and RE is around 70% in the revised National Energy Policy (KEN), whereas this was fossil energy in the previous KEN. Gas serves as a safe, transitional bridge for Indonesia to promote cleaner energy use.
The country has significant natural gas reserves, estimated at around 100 trillion cubic feet (Tcf), with proven and additional exploration potential around Sumatra, Kalimantan and southern border regions that could increase potential reserves to 150 Tcf.
Existing gas infrastructure like liquefied natural gas terminals, transmission and distribution pipelines and regasification terminals need reinforcement.
Additionally, improving gas conservation technology and optimisation through carbon capture and storage and carbon capture, utilisation and storage technologies are essential.
Government commitment
The government has a high commitment to increasing the clean energy mix, supported by strategic steps such as policy frameworks, regulations, incentives, financial support like green financing, infrastructure development, increasing access in remote areas through micro-grids and off-grid systems, capacity building, technology enhancement and international cooperation.
Increasing domestic primary energy production, adopting cleaner technologies, energy efficiency and sustainable infrastructure development that is supported by phased, continuous and equitable energy supply and regulation will enhance economic resilience, public welfare and national bargaining power globally toward Indonesia’s golden age in 2045. — The Jakarta Post/ANN
Sampe L. Purba is a former senior adviser to Indonesia’s Energy and Mineral Resources Ministry. The views expressed here are the writer’s own.
