Indonesia Issues a Regulation to Increase Renewable Energy use
This week, Indonesia issued a new regulation that will encourage renewable energy use. This is a landmark regulation as Indonesia is one of the world’s top carbon emitters due to coal use. Along with encouraging renewable energy, a presidential decree said that Indonesia also plants to retire some of their coal plants early.
Indonesia being the world’s largest exporter of coal wants to nearly double its clean energy sources making it so that renewables account for about 23% of its energy mix by 2025. Today, its renewable energy mix is only at about 12% and coal is providing 60% of electricty in Indonesia. Last year, Indonesia set a goal to achieve net-zero emissions by 2060 and has pledged to phase down coal use to help reach the Paris Agreement goal of liming warming to less than 1.5 degrees Celsius.
Within these new regulations its noted that authorities must create plans for early retirement of some coal plants and that the government could help to absorb any losses they may face. It also outlines that no new coal power plants can be built, but existing plants that are already in the pipeline and that are integrated with the natural resources processing industry will be allowed to continue as planned. There is a caveat that even these approved plants in the pipeline will need to reduce emissions by 35% within 10 years of operation, and can only be operated until 2050.
To incentivize renewable energy use even further the government is setting a new pricing system for geothermal, hydro, and solar power to encourage greater investments. It will also provide fiscal incentive including financing facilities and ease of licensing in forest areas.
Sources:
https://www.reuters.com/markets/asia/indonesia-unveils-new-regulation-boost-renewable-energy-use-2022-09-15/#:~:text=JAKARTA%2C%20Sept%2016%20(Reuters),early%2C%20a%20presidential%20decree%20said.
https://www.asiafinancial.com/indonesian-regulation-aims-to-boost-renewable-energy
https://www.plenglish.com/news/2022/09/15/indonesia-approves-regulation-to-promote-renewable-energy-use/
