Jakarta, 14 August – New analysis from global energy think tank Ember reveals that Indonesia has the potential to create 96,000 jobs by expanding its clean power capacity and reducing reliance on fossil fuels. The country can meet its 2030 electricity demand without new coal plants by increasing the efficiency of current coal plants.
Indonesia could create close to 100,000 green jobs in coal producing regions with clean power expansion
14 Aug 2024
This report analyses Indonesia’s State Electricity Company (PLN) Electricity Supply Business Plan (RUPTL) 2021-2030 and the Just Energy Transition Partnership (JETP) Comprehensive Investment and Policy Plan (CIPP). It also explores strategies for incorporating a just transition into energy plans at the provincial level.
Since the introduction of the National Energy Policy (NEP) in 2014, fossil fuels have grown to account for 81% of Indonesia’s electricity. The use of fossil fuels, particularly coal, has risen significantly in the past decade. From 2013 to 2023, fossil fuel generation increased by 50%, leading to a rise in power sector emissions by 86 million tonnes of CO2 (MtCO2).
This year, the country is set to launch a new NEP aimed at improving energy security and promoting energy transition with goals to peak emissions by 2035 and achieve net zero by 2060. However, the renewable energy target is expected to be reduced from 23% to between 17-19% by 2025.
Rapid expansion of renewables in coal-producing regions could reduce emissions, attract investment and create jobs
The analysis indicates that Indonesia’s on-grid electricity demand is expected to increase by approximately 4.7% annually, with generation likely to surpass demand by 42 TWh by 2030. This suggests that Indonesia should reconsider building new coal power plants to avoid the high risk of stranded assets.
Additionally, renewable energy projects could transform coal-producing regions such as East Kalimantan, South Kalimantan and South Sumatra. These three provinces emit around 30 MtCO2e from coal mine methane and coal-fired power plants.
Under the current RUPTL, 21 GW of renewables will be added by 2030, with an additional 36 GW from JETP CIPP targets. Allocating renewables projects to coal-producing regions could create 50,000 jobs and attract $4.3 billion USD in investment.
Expanding solar projects and cancelling new coal capacities could create additional 46,000 jobs and more than double the investment. Overall, this could reduce emissions by 18 MtCO2e, attract over $9.4 billion USD investment and create close to 100,000 high-skilled jobs.
Indonesia’s energy transition can be more equitable by repurposing coal projects into sustainable uses and focusing on renewable projects in impacted regions.
Energy transition provides an opportunity to transform the economy of Indonesia’s coal-producing regions and avoid coal-related emissions in the regions. Incorporating JETP targets into national and subnational policies will be the first step in realising this potential.
About Ember
Ember is an independent energy think tank that aims to accelerate the clean energy transition with data and policy. It creates targeted data insights to advance policies that urgently shift the world to a clean, electrified energy future.
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