PLN Receives Rp8.09 Trillion Of Funds From France For Energy Transition

JAKARTA - PT Perusahaan Listrik Negara (Persero) or PLN received a disbursement of 500 million euros or the equivalent of Rp8.09 trillion (assuming an exchange rate of Rp16,076 per euro) from the French Development Agency (AFD) to support the energy transition in Indonesia.

This commitment was stated through the signing of a Letter of Intent to strengthen cooperation between France and Indonesia in the energy sector on Wednesday, November 24.

Through the signing, Indonesia and France agreed to strengthen cooperation by mobilizing technical and financial support from the AFD Group for the transition of energy and new and renewable energy (EBT) in Indonesia. One of the points of this agreement is the commitment of indicative support of 500 million euros for the next 5 years. .

PLN President Director Zulkifli Zaini said that PLN was committed to supporting the acceleration of the energy transition for a better future. In the midst of efforts to reduce carbon emissions, the company has several approaches to ensure a sustainable electricity business.

"These include ensuring lean and efficient company operations, providing green energy for the future, and becoming a customer-focused company by providing reliable and affordable services," he said in a written statement received by VOI, Friday, November 26.

In accelerating carbon neutral 2060, Zulkifli revealed four things that must be considered so that the energy transition can run smoothly. First, the adjustment of electricity tariffs for customers. Second, large-scale investment. Third, the application of technology on a large scale. Fourth, customer investment to switch to using low-carbon equipment.

"Thus, business development and electrifying lifestyle campaigns need to be promoted. For example, the use of electric stoves, electric vehicles, and emissions trading," he said.

In the business as usual (BAU) scenario, electricity sector emissions will reach 0.92 billion tons of CO2 in 2060. Therefore, PLN has launched a strategy to become a clean and green electricity company. One of them is by stopping construction and retiring the existing steam power plant (PLTU) in stages.

"Based on the roadmap, PLN will retire the 10 Giga Watt (GW) sub-critical PLTU in 2035. Then the 10 GW super critical PLTU will also be retired in 2045. The last stage in 2055, 55 GW ultra super critical PLTU will be retired ," he said.

At the same time, PLN will invest in accelerating the increase in new and renewable energy generation capacity (EBT) to 20.9 GW, as well as the development of electricity storage technology in the form of large batteries to carbon and hydrogen capture technology.

Zulkifli said that other programs prepared by PLN to support the energy transition are gas expansion, co-firing programs, conversion of PLTD to EBT, to increase energy efficiency and reduce grid losses.

"At least PLN needs an investment of more than 500 billion US dollars to support the achievement of Carbon Neutral in 2060. Therefore, PLN needs support from many parties to carry out this energy transition," he said.

On the other hand, over the past 10 years, AFD has mobilized 520 million euros to support Indonesia in energy sector reform, public investment financing, and mobilization of experts from France. During this time, Indonesia has experienced significant economic growth that has doubled its energy consumption.

To contribute to controlling climate change, Indonesia is committed to reducing greenhouse gas (GHG) emissions within the framework of the Paris Agreement by 29 percent from the BAU scenario with its own efforts and 41 percent with the support of the international community.

By strengthening this collaboration, AFD will assist Indonesia in the form of grants for technical assistance in project preparation and implementation, soft loans to the Indonesian government and PLN, or even loans to the private sector for investment in renewable energy and energy efficiency.

Through this commitment, it is hoped that it will result in the announcement of a carbon neutrality plan in the energy sector in 2021, which will be achieved by 2050.

The government has also announced a moratorium on the construction of new coal power plants, as well as the publication of the PLN RUPTL investment plan (Electricity Supply Business Plan) 2021-2030.

"In the greenest RUPTL ever, the portion of new and renewable energy (EBT) is bigger, namely 51.6 percent or 20,923 MW, while the portion of fossil energy is lower at 48 percent or 19,652 MW," he explained.