The Action for Ecology and People’s Emancipation (AEER) asks the government to stop nickel industry’s reliance on coal-fired captive power plants in Sulawesi as continued dependence threatens climate goals and undermines the green industry agenda.

“Government must halt new captive coal power projects and prepare a clear phase-out roadmap. Clean energy transition should be the backbone of nickel industry decarbonization,” Riski Saputra, AEER researcher, said at the Annual Indonesia Green Industry Summit (AIGIS) 2025 in Jakarta on Thursday, August 21, 2025.

According to data from the National Development Planning Agency (Bappenas), nickel industry emissions in 2023 accounted for 22 percent of Indonesia’s energy and Industrial Processes and Product Use (IPPU) sector emissions, with 98 percent coming from pyrometallurgical smelters and 63 percent from captive coal plants. If unchecked, greenhouse gas emissions from the sector could rise by 86 percent by 2045, jeopardizing Indonesia’s 2060 net-zero target.

Despite Sulawesi’s renewable energy potential of more than 250 GW, mainly from solar and hydropower, the national electricity supply plan (RUPTL) 2025–2034 allocates less than 10 GW of new renewable capacity over the next decade − far below the soaring demand from smelters.

AEER also warned of risks of stranded assets, as nickel reserves in Central and Southeast Sulawesi could be depleted before 2045.

“Excessive extraction means renewable energy projects risk becoming unprofitable. Synchronizing mining and energy planning is essential,” Riski said.

As private initiatives remain symbolic, such as a 1.27 MWp solar project at the Indonesia Morowali Industrial Park (IMIP), AEER called on State power utility company PLN to accelerate Sulawesi’s 150–275 kV interconnection network to make renewable energy accessible to industries.

Nickel mining overlaps with 1.2 million hectares of natural forest in Sulawesi, where clearance could release hundreds of millions of tons of carbon. AEER stressed that forest protection must be integral to nickel industry governance.

Annisa Putri Widia, First Expert Planner at Bappenas, reaffirmed that while Indonesia targets 8 percent economic growth supported by nickel, it has also pledged a 45.73 percent emission reduction by 2030. “Decarbonizing the nickel industry is non-negotiable. By 2045, emissions must be cut by 81 percent, including through energy transition,” she said.

However, Annisa acknowledged challenges, particularly low uptake of the Just Energy Transition Partnership (JETP), which many investors still view as not bankable.

Yeni Gusrini, senior electricity policy analyst at the Energy and Mineral Resources Ministry, said PLN is planning a 3,996 km 275 kV backbone network to unify Sulawesi’s power systems, with 7.7 GW of renewables expected by 2034.

Meanwhile, Kevin Marojahan, electrical engineering lecturer at the Bandung Institute of Technology (ITB), highlighted cost concerns. He said electricity prices significantly affect nickel production costs, especially with energy-intensive RKEF smelter technology.

“As long as coal remains the cheapest option, industries will not switch without strict policies,” he warned.

AEER concluded that energy transition in the nickel sector must go beyond replacing coal with renewables. Efficiency, production limits, reduced energy consumption, and ecosystem protection should all be part of an integrated governance approach − or else, the nickel boom could become a “time bomb” for both the economy and the climate.