Indonesia’s Clean Energy Shift Could Create Close to 100,000 Jobs
Indonesia could create close to 100,000 jobs by expanding clean energy and reducing coal reliance, according to Ember. This shift could significantly cut emissions and attract over USD 9 billion in investment.
August 14, 2024. By EI News Network
Since the introduction of the National Energy Policy (NEP) in 2014, fossil fuels have accounted for 81 percent of Indonesia’s electricity production. The reliance on fossil fuels, particularly coal, has escalated by 50 percent over the past decade, resulting in an 86 million-tonne increase in power sector emissions. The new NEP aims to peak emissions by 2035 and achieve net-zero by 2060. However, the renewable energy target is expected to be lowered from 23 percent to between 17-19 percent by 2025.
The analysis reveals that Indonesia’s on-grid electricity demand is anticipated to grow by about 4.7 percent annually, potentially surpassing demand by 42 TWh by 2030. This projection suggests a reconsideration of new coal power plants to avoid stranded assets.
By expanding renewable energy in coal-producing regions such as East Kalimantan, South Kalimantan, and South Sumatra, Indonesia can revitalize these areas economically. The current RUPTL includes plans to add 21 GW of renewables by 2030, with an additional 36 GW from JETP CIPP targets. Allocating renewable projects to these coal-rich regions could create 50,000 jobs and attract USD 4.3 billion in investment. Shifting focus from new coal capacities to solar projects could further generate an additional 46,000 jobs, doubling the investment to over USD 9.4 billion, and cut emissions by 18 MtCO2e, leading to nearly 100,000 high-skilled jobs in total.
Dr. Dinita Setyawati, Senior Electricity Policy Analyst for Southeast Asia at Ember, emphasizes that Indonesia’s energy transition offers a significant opportunity to transform coal-producing regions and mitigate coal-related emissions. Incorporating JETP targets into national and provincial policies is essential for unlocking this potential.
Dody Setiawan, Senior Analyst for Climate and Energy in Indonesia at Ember, emphasised the importance of aligning energy transition strategies with economic development goals and calls for innovative financing solutions and international cooperation.
Edo Mahendra, Head of the Indonesia Energy Transition Implementation Joint Office (Rumah PATEN), asserts that solar power could play a crucial role in Indonesia’s energy transition, driving job creation and economic growth.
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