Indonesia industrial coal power plans undercut emissions pledge: Report

Indonesia’s Ambitious Climate Goals at Risk Amid Coal Expansion Plans

Indonesia, Southeast Asia’s largest economy and one of the world’s top carbon emitters, is at a crossroads in its efforts to combat climate change. President Prabowo Subianto has made bold commitments to phase out coal-fired power plants within 15 years and achieve net-zero emissions by 2050. These pledges are part of a broader strategy to reduce Indonesia’s carbon footprint and transition towards cleaner energy sources. However, recent plans to expand "captive" coal plants—facilities that provide electricity directly to industrial users rather than the national grid—threaten to undermine these ambitious climate goals.

A report published on February 20 by Ember, a London-based energy think tank, highlights the potential consequences of Indonesia’s new national electricity master plan. While the plan includes projections for growth in renewable energy, it also outlines a significant increase in coal-fired power generation, particularly through the expansion of captive coal plants. This raises serious concerns about Indonesia’s ability to meet its 2030 target of reducing CO2 emissions and its long-term goal of eliminating coal entirely by 2040.

The Role of Captive Coal Plants in Indonesia’s Energy Mix

Captive coal plants play a unique role in Indonesia’s energy landscape. Unlike traditional coal-fired power plants that supply electricity to the national grid, captive plants are dedicated to serving the energy needs of specific industries, such as manufacturing and mining. These plants are often justified as a way to provide reliable and consistent power to energy-intensive industries, which are critical to Indonesia’s economic growth.

However, the proliferation of captive coal plants poses a significant challenge to Indonesia’s climate ambitions. According to Ember’s report, Indonesia’s new electricity master plan includes plans to add 26.8 gigawatts (GW) of new coal capacity over the next seven years, with more than 20 GW of this capacity coming from captive coal plants. This expansion would not only increase Indonesia’s reliance on coal but also lock the country into a high-carbon energy pathway for decades to come.

A Contradictory Energy Plan: Renewables vs. Coal

Indonesia’s new electricity master plan appears to send mixed signals about the country’s energy future. On one hand, the plan includes a commitment to increase the share of renewable energy in the national power mix to 44% by 2030. This is a positive step toward reducing Indonesia’s dependence on fossil fuels and lowering its carbon emissions. Renewable energy sources, such as solar, wind, and hydropower, are expected to play a growing role in meeting the country’s electricity needs.

On the other hand, the plan’s emphasis on expanding coal-fired power generation—particularly through captive coal plants—creates a contradiction. By continuing to invest in coal, Indonesia risks undermining its renewable energy goals and exacerbating its environmental impact. The report by Ember warns that the planned expansion of coal capacity could significantly increase Indonesia’s carbon emissions, making it even more challenging to achieve its climate targets.

The Numbers Behind Indonesia’s Coal Expansion

The sheer scale of Indonesia’s coal expansion plans is staggering. The country currently operates 49.7 GW of coal-fired power plants, with 253 plants already in operation as of December 2023. However, dozens more coal-fired plants are still under construction, including a number of captive coal facilities. The addition of 26.8 GW of new coal capacity over the next seven years would further entrench coal as a dominant source of electricity in Indonesia.

This expansion is particularly concerning given the global push to transition away from fossil fuels. While Indonesia has made progress in developing its renewable energy sector, the continued reliance on coal may hinder its efforts to reduce emissions and transition to a cleaner energy mix. The report by Ember underscores the need for Indonesia to reassess its energy strategy and prioritize renewable energy over coal.

State Electricity Company’s Silence on Coal Expansion

Despite the growing concerns about Indonesia’s coal expansion plans, the state electricity company, Perusahaan Listrik Negara (PLN), has not responded to requests for comment. This silence is notable, as PLN plays a crucial role in implementing the country’s energy policy and transitioning to cleaner energy sources. The lack of clarity from PLN raises questions about the government’s commitment to its climate goals and whether it is prepared to address the contradictions in its energy plan.

As Indonesia moves forward with its energy strategy, it will be important for the government and state-owned enterprises like PLN to provide greater transparency and accountability. This includes explaining how the expansion of captive coal plants aligns with Indonesia’s climate commitments and what steps are being taken to ensure a sustainable energy transition.

The Broader Implications of Indonesia’s Energy Choices

Indonesia’s energy choices have far-reaching implications, both domestically and globally. As one of the world’s largest emitters, Indonesia’s ability to meet its climate goals will have a significant impact on the global effort to combat climate change. The expansion of captive coal plants not only threatens Indonesia’s own emissions targets but also sets a problematic precedent for other countries that may be considering similar strategies.

At the same time, Indonesia’s transition to renewable energy could serve as a model for other developing nations. By prioritizing clean energy and phasing out coal, Indonesia could reduce its carbon footprint, improve public health, and create new economic opportunities. However, this transition will require strong leadership and a commitment to overcoming the challenges posed by the country’s existing energy infrastructure.

In conclusion, Indonesia’s planned expansion of captive coal plants poses a significant threat to its climate goals and renewable energy ambitions. While the country has made progress in developing its renewable energy sector, the continued reliance on coal risks undermining these efforts and locking Indonesia into a high-carbon future. To achieve its climate targets and support global efforts to combat climate change, Indonesia must carefully reconsider its energy strategy and prioritize a sustainable transition to cleaner energy sources.