Minister of Finance, Sri Mulyani Indrawati, says Indonesia is finalizing an early retirement package for a 660-megawatt coal-fired power plant that will become a pilot project for energy transition.

"Currently, we are finalizing an early retirement package for a 660-megawatt (MW) coal-fired power plant that will be our pilot project," Sri Mulyani told the Business Session of the Board of Governors of the Asian Development Bank (ADB) in Tbilisi, Georgia, on Sunday, as quoted by Antara.

The session is one of the series of the ADB's 57th Annual Meeting held on May 2-5, 2024.

"We hope this project can be successful and replicated in other coal-fired power plants," she said.

On that occasion, Sri Mulyani invited other countries and parties to support the financial needs in making the energy transition from fossil fuels to environmentally friendly energy in Indonesia.

"Given the large financial needs for energy transition, we would like to invite other countries and parties to support us," she said.

She said further that the transition to renewable energy presented a formidable challenge due to Indonesia's dependence on coal and other non-renewable resources. While there is a need to shift to renewable energy, the high cost of making the transition poses a significant financial burden, she added.

Nonetheless, Indonesia remains committed to achieving its target of 66 percent renewable energy by 2050, despite the large investments required to achieve this goal. Indonesia has established an Energy Transition Mechanism (ETM) platform to accelerate progress on the transition, with ADB playing a key role in this.

Previously, Indonesia and ADB agreed on a commitment to accelerate the implementation of early retirement of steam power plants (PLTU) in Indonesia, which is carried out within the framework of the ETM.

ADB as an international financial institution that provides loans, guarantees, capital investments, grants and technical assistance to developing countries in Asia and the Pacific, has signed a non-binding framework agreement to support the early retirement of the 660-megawatt Cirebon-1 PLTU, which is supposed to end in July 2042, but accelerated to December 2035.

The agreement was signed by ADB, State electricity company PT PLN and PT Cirebon Electric Power (CEP) as well as Indonesia's investment management agency (INA) on the sidelines of COP28 in Dubai, United Arab Emirates in early December 2023.