Indonesia needs to reduce capacity of its coal fired power plant for 3 gigawatt (GW) per year and simultaneously increase its renewable energy capacity up to 8 GW annually if it wants to be free of coals in 2040, climate and energy think tank EMBER says.
The latest analysis by EMBER titled “Coal-fired power plant pension in Indonesia by 2040 needs increased renewable energy” gives credit to President Prabowo Subianto government’s commitment to gradually stop the use of coal by 2040 and add renewable energy for 75 GW.
“Indonesia is at a decisive point to end the use of coal by 2040. Raw materials for battery components are Indonesia’s key strength in supporting renewable energy storage capacity. This presents great potential for integrating solar energy with batteries which will facilitate the transition to green economy,” Dinita Setyawati, Senior Electricity Policy Analyst for Southeast Asia at EMBER, said as quoted in a statement on Monday, December 9, 2024.
She suggested that coal fired power plant needs to be reduced for 3 GW per year with overall coal fired power plant’s pension target in 2040. At the same time, the renewable energy capacity needs to be boosted for 8 GW per year until 65 percent of the projected electricity demand of 806 terawatt hour (TWh) in 2040. This calculation is based on the projected electricity demand growth of 5 percent per year.
In detail, solar energy will contribute 20 percent, wind will contribute 11 percent and other renewable energy sources such as nuclear, geothermal, bioenergy and hydro will contribute 34 percent.
Dinita also suggested that in an effort to optimize the use of solar energy, Indonesia needs to integrate storage battery of 4 GW per year until 2040, mainly because of electricity peak burden is in the night.
Decarbonization
The EMBER analysis offers several recommendations to realize decarbonization of electricity in Indonesia. They include greater involvement of private sectors, energy saving integration to optimize the use of solar power, comprehensive regulatory framework for early pension of coal fired power plant, economic diversification plans for provinces with coal dependency, increased connectivity of electricity network, better flexibility of coal fired power plant , financial support, and integration of captive coal fired power plant into early pension plan of coal fired power plant.
“As owner of the fifth biggest coal fired power plant in the world, Indonesia’s ambiton of coal-fired power plant early retirement in 2040 is a significant turning point. To achieve the target, Indonesia needs to accelerate renewable energy expansion and formulate a just transition policy. This is a serious challenge, but also an opportunity for Indonesia to realize sustainable economy and has potential to change global coal consumption,” Rini Sucahyo, Communication Manager of EMBER Asia, said.
Gradual retirement of coal fired power plant until 2040 will position Indonesia to achieve global climate target of 1.5°C. This marks a significant step to sustainable and low carbon future.
“By implementing energy transition, Indonesia do not only contribute to global climate objective, but also encourage long term economic growth and make sure safe climate condition and environment,” Rini concluded.
