Rp3,500 Trillion Investment Needed to Reduce Indonesia’s Emissions
MINISTRY OF ENERGY AND MINERAL RESOURCES
REPUBLIC OF INDONESIA
PRESS RELEASE
NUMBER: 257.Pers/04/SJI/2020
Date: 19 August 2020
Rp3,500 Trillion Investment Needed to Reduce Indonesia's Emissions
The government has set a target for reducing greenhouse gas emissions by 314 million tonnes of CO2 in 2030. New, Renewable Energy (NRE)-based electricity generation is set to contribute 156.6 million tonnes of CO2 in the reduction. According to the Ratification of the Paris Agreement during the Conference on Parties (COP) 22 in Morocco in November 2016, Indonesia is committed to reducing its greenhouse gas emissions by 29 percent on its own efforts and 41 percent with international support until the year 2030.
"The government has set a target for reducing the greenhouse gas emissions by 314 million tonnes of CO2 in 2030 with an estimated investment need of Rp3,500 trillion. The NRE electricity generation is set a reduction target of 156.6 million tonnes of CO2 (49.8% of total mitigation action from the energy sector) with an investment need of Rp1,690 trillion," said Geothermal Director of Directorate General of New, Renewable Energy and Energy Conservation of Ministry of EMR, Ida Nuryatin Finahari, in a webinar titled the Benefits of PLTP Dieng 2 (55 MW) and Patuha 2 (55 MW) Projects on Wednesday (19/8).
Ida added that curbs on the increase in global temperature below 2?C and ideally 1.5?C above the pre-industrial levels will be synchronized with the 23 percent NRE portion set out in the energy mix for the year 2025.
"As one of the efforts to reach the targets of the National Energy Policy, Indonesia has developed a number of NRE-based power plants with an installed capacity of 10.4 GW until the first semester of 2020. The capacity is dominated by hydro-energy with a capacity of 6.07 GW, followed by geothermal energy with a capacity of 2.13 GW," said Ida.
Indonesia's primary energy supplies are dominated by fossil energy, with approximately 90 percent of energy comes from coal, gas, and oil. In 2019, the NRE composition in the primary energy mix of power plants was only 9.15 percent, while coal composition was 37.15 percent and gas 33.58 percent.
To achieve all targets, the government has introduced a number of measures, for example by improving sales price schemes and regulations as well as providing incentives. This way, the government hopes to attract investors making investment in environmentally-friendly energy such as geothermal, hydro, and wind. (IY)
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