Latest news with #DodySetiawan
The Star
5 days ago
- Business
- The Star
Jakarta's energy plan may sideline renewables
JAKARTA: The long-awaited 2025-2034 electricity business plan (RUPTL) could sideline renewable energy despite containing a huge amount of planned green power, as experts suggested the new power procurement plan was leaning toward repeating past mistakes and undermining energy transition commitments. Dody Setiawan, senior analyst for climate and energy at think tank Ember, told The Jakarta Post on May 28 that the new RUPTL backloaded 72% of the planned 42.6 gigawatt (GW) of new and renewable energy projects to the second half of the 10-year procurement period. Instead, the government and state-utility company PT Perusahaan Listrik Negara (PLN) designed it to frontload 12.7GW of coal and gas plants in the first half of the 10-year period, which is 76% of the planned fossil fuel powered generation in the RUPTL. 'We observed a strong energy security focus in the (new) RUPTL, with large capacity additions to support economic growth and rising demand from downstream industries. 'On the other hand, decarbonisation efforts remain (a) secondary (priority),' Dody said. He added that increased reliance on gas-powered plants would also come with supply risks, given the consistent decline in domestic natural gas production, which could translate into more costly power generation. BMI Research, a unit of Fitch, dubbed the newly launched electricity business procurement plan a 'step back' from Indonesia's energy transition and climate commitment. It pointed out that the 6.3GW of new coal-fired capacity indicates a 'persistent reliance on coal' as a baseload power source despite a 2040 coal phase-target announced by President Prabowo Subianto during the Group of 20 Summit in Rio De Janeiro late last year. Mutya Yustika, an energy economist at the Institute for Energy Economics and Financial Analysis (IEEFA), expected that placing most renewable energy projects in the second half of the RUPTL's 10-year period would raise investors' concerns over risks of shifting policy priorities, regulatory inconsistencies and PLN's capacity to support renewable projects. Despite spanning a decade, the government has a history of revising the long-term business plan midway, which occurred four times from 2015 to 2019 and two times in the past five years. Mutya also pointed out that the previous RUPTL launched in 2021 included 21GW of renewable capacity, half of which was slated for 2025, but it saw far slower-than-expected progress in renewable energy procurement, which may cloud investors' confidence in projects offered by the government and PLN in the future. Instead of the required 2.1GW per year, PLN has only added around 0.6GW annually, highlighting a significant gap between targets and execution. 'Without clearer policies, streamlined procurement and tools like joint transmission networks, investor confidence in Indonesia's renewables will remain low,' she told the Post. This lagging progress has also prompted the government to slash its projections on renewable energy contributions to the national energy mix from initially 23% by the end of 2025 to between 17% and 19% in the same period. The new RUPTL was designed with the assumption that the economy could grow by 8% by the end of 2029, which officials hoped would translate to a surge in power demand roughly at the same pace. However, experts warned this could lead to overestimations, repeating the mistakes of the past administration that resulted in PLN generating more power than the country could consume. In 2015, former President Joko 'Jokowi' Widodo launched a plan to add 35GW of electricity to the grid in the next decade, as the administration expected the country's economic growth to reach about 7% over the coming years. Instead, the country's gross domestic product has been growing at an average of 5%, leaving behind an electricity oversupply, mostly from coal-powered plants, with consequences extending to delays and postponement of renewable energy projects. Experts have suggested it is unlikely the country could see the 8% economic growth envisioned by Prabowo as this year's growth is projected to expand below the usual 5% rate. Ember's Dody said if the ambitious projected demand growth fails to materialise, PLN would face another oversupply that would limit access for renewable projects to supply the grid already saturated with power from thermal plants. IEEFA's Mutya warned PLN could face similar pressure as in the past when it was locked into costly coal contracts for excess power that ended up straining its finances. Most power purchasing agreements contained take-or-pay stipulations that obligated PLN to either take delivery of electricity generated by independent power producers or pay a penalty if it chooses not to do so, which guaranteed minimum revenue for investors. — The Jakarta Post/ANN
Yahoo
20-02-2025
- Business
- Yahoo
Indonesia industrial coal power plans undercut emissions pledge: report
Indonesia's planned expansion of "captive" coal plants used to power industry is threatening its pledge to cut CO2 emissions by 2030 and close all coal-fired plants by a decade later, said a report published Thursday. Coal-dependent Indonesia, Southeast Asia's largest economy, is one of the world's top emitters but President Prabowo Subianto last year committed to phasing out coal in just 15 years and reaching net-zero emissions by mid-century. Indonesia's new national electricity master plan announced in November projects growth in renewables but also a sharp rise in coal generation beyond 2030, according to a report by London-based energy think tank Ember. The new plan raises "concerns that Indonesia's latest electricity masterplan could significantly increase coal power generation", Ember said. Jakarta previously said its renewable energy mix would reach 44 percent of its power generation by 2030. But the new plan includes 26.8 gigawatts of new coal capacity over the next seven years, Ember said, with more than 20 GW of that coming from so-called captive coal expansion, which supplies energy to industry rather than the grid. Indonesia currently operates 49.7 GW of coal-fired power plants, according to Ember, and the government says 253 coal-fired power plants were operational as of December. But dozens more coal-fired plants remain under construction, including captive coal plants. State electricity company Perusahaan Listrik Negara did not respond to a request for comment. "Expanding captive coal while global markets shift to clean energy makes little economic sense," said Dody Setiawan, Ember's senior climate and energy analyst for Indonesia. "Committing to a clear path for coal phase-out while prioritising renewables would help Indonesia address the multi-faceted challenges that all coal-dependent economies must face." The Centre for Research on Energy and Clean Air (CREA), which said much of the captive coal growth was centred on Sulawesi and North Maluku islands, issued a warning to locals. They "will have to bear the highest health and economic burden from pollution exposure," said CREA analyst Katherine Hasan. Indonesia secured a $20 billion Just Energy Transition Partnership with developed nations in 2022, which was supposed to speed its clean energy transition, but little of that money has been seen so far. This month the environment ministry rushed to again pledge Jakarta's support for the landmark Paris climate deal after its climate envoy suggested the agreement was irrelevant after US President Donald Trump again withdrew from it. The report said Indonesia needed to do much more to meet the Paris agreement target by 2050. bur-jfx/mtp
Yahoo
20-02-2025
- Business
- Yahoo
Indonesia industrial coal power plans undercut emissions pledge: report
Indonesia's planned expansion of "captive" coal plants used to power industry is threatening its pledge to cut CO2 emissions by 2030 and close all coal-fired plants by a decade later, said a report published Thursday. Coal-dependent Indonesia, Southeast Asia's largest economy, is one of the world's top emitters but President Prabowo Subianto last year committed to phasing out coal in just 15 years and reaching net-zero emissions by mid-century. Indonesia's new national electricity master plan announced in November projects growth in renewables but also a sharp rise in coal generation beyond 2030, according to a report by London-based energy think tank Ember. The new plan raises "concerns that Indonesia's latest electricity masterplan could significantly increase coal power generation", Ember said. Jakarta previously said its renewable energy mix would reach 44 percent of its power generation by 2030. But the new plan includes 26.8 gigawatts of new coal capacity over the next seven years, Ember said, with more than 20 GW of that coming from so-called captive coal expansion, which supplies energy to industry rather than the grid. Indonesia currently operates 49.7 GW of coal-fired power plants, according to Ember, and the government says 253 coal-fired power plants were operational as of December. But dozens more coal-fired plants remain under construction, including captive coal plants. State electricity company Perusahaan Listrik Negara did not respond to a request for comment. "Expanding captive coal while global markets shift to clean energy makes little economic sense," said Dody Setiawan, Ember's senior climate and energy analyst for Indonesia. "Committing to a clear path for coal phase-out while prioritising renewables would help Indonesia address the multi-faceted challenges that all coal-dependent economies must face." The Centre for Research on Energy and Clean Air (CREA), which said much of the captive coal growth was centred on Sulawesi and North Maluku islands, issued a warning to locals. They "will have to bear the highest health and economic burden from pollution exposure," said CREA analyst Katherine Hasan. Indonesia secured a $20 billion Just Energy Transition Partnership with developed nations in 2022, which was supposed to speed its clean energy transition, but little of that money has been seen so far. This month the environment ministry rushed to again pledge Jakarta's support for the landmark Paris climate deal after its climate envoy suggested the agreement was irrelevant after US President Donald Trump again withdrew from it. The report said Indonesia needed to do much more to meet the Paris agreement target by 2050. bur-jfx/mtp
