Ministry Of Finance Disbursed Disbursement Of Constrained JETP Funds
BOGOR - The government is preparing an investment plan that will be funded with the Just Energy Transitions Partnership (JETP) scheme in accordance with what was agreed between the Indonesian government and the International Partners Group (IPG).
Head of the Center for Climate and Multilateral Change Financing Policy of the Fiscal Policy Agency (BKF) of the Ministry of Finance Boby Wahyu Hernawan said JETP aims to improve the business environment for green economy development in Indonesia by developing green infrastructure and improving sustainable project funding.
"A fair and affordable transition is the principle of the Indonesian government to balance the recovery and transition agenda," he explained in media gathering, Wednesday, May 29.
Boby conveyed that the investment plan and list of projects that will be funded through JETP have been explained in the Comprehensive Investment and Policy Plan (CIPP). However, this commitment has not been realized.
"Indeed, currently global challenges are not just Indonesia's challenge to realize that commitment. Indonesia is ready, the list of projects in CIPP already exists, it's just a matter of when they disburse their funds," he said.
Boby claims Indonesia has carried out its obligations and homework as stated in JETP. Currently, Indonesia is waiting for the IPG to carry out its obligations in accordance with the agreement contained in the JETP.
"Indonesia always does its homework. It's just a matter of whether the parties will carry out their obligations to us or not. But Indonesia is always committed to doing its homework, we have planning, we have project preparations, project lists and so on, which we have in the document. Even Indonesia is now focusing on implementing JETP," he said.
For information, on November 15, 2022. President Joko Widodo and the leaders of the International Partners Group (IPG), co-led by the United States and Japan, including Canada, Denmark, EU, France, Germany, Italy, Norway, and the UK, launched Just and Energy Transition Partnership (JETP) at the G20 Presidency.
In addition, JETP supports an ambitious and fair energy transition in Indonesia, consistent with international goals to limit global warming to 1.5 degC.
Meanwhile, JETP's main goal is to limit the emissions of power plants to 290 megatons of CO2e by 2030, down from the original 357 CO2e megatons. As well as encouraging the closure and limiting the development of coal-fired power plants.
Then, another goal is to accelerate the increase in the EBT power generation mix to reach 34 percent by 2030, and support affected communities to adapt to the transition.
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Through JETP, IPG countries are committed to providing funding of US$20 billion or equivalent to Rp330 trillion to support the energy transition in Indonesia. In addition, Indonesia targets to achieve net zero emissions by 2050 in the electricity sector.
Meanwhile, funding to support the energy transition in Indonesia comes from 50 percent of the Public from G7, Norway and Denmark, as well as 50 percent of the private sector from Glasgow Financial Alliance for Net Zero (GFANZ) consisting of Bank of America, HSBC, Citibank, Standard Chartered, MUFG, and Macquarie.
To achieve the net zero target, Indonesia is committed to accelerating the early retirement of coal steam power plants (PLTU). Referring to CIPP, there are 2 PLTUs that will be retired early, namely the Ratu Port PLTU in 2037 and the Cirebon-1 PLTU in 2035.