Need Big Financing, OJK Estimates Transition Of Fossil To Renewable Energy Needs IDR 81 Trillion

Chairman of the OJK Board of Commissioners, Wimboh Santoso. (Photo: screenshot of OJK Youtube)

JAKARTA - The Financial Services Authority (OJK) said that the transition to energy use towards the goal of green energy requires no small amount of money.

Chairman of the OJK Board of Commissioners, Wimboh Santoso, said that financing needs cannot be covered solely by relying on the State Revenue and Expenditure Budget (APBN).

"The government has calculated the funds needed to finance the transition from fossil energy to renewable energy, which reached US$5.7 billion or around Rp. Tuesday, December 28th.

According to Wimboh, synergy between the private sector and the government as well as the assistance of international organizations is needed to optimally support the enormous financing needs.

"This transition cost is also related to changes in the downstream industry, which must change the processing process according to the principles of the green economy," he said.

Wimboh added, Indonesia and the United States have formed a Climate Change Task Force where OJK is a member of Working Group 4 regarding Sustainable and Blended Finance for Our Common Future.

He mentioned that the biggest challenge in Working Group 4 is providing sustainable financing to deal with climate change.

"This is because the transition from a conventional economy to a sustainable economy that focuses on the environment requires very large costs," he said.

As previously reported, Indonesia is one of the countries that is actively releasing green financing.

It was noted that global green sukuk with a share of foreign investors managed to obtain funding of US$3.5 billion or equivalent to Rp.49.7 trillion (exchange rate of Rp. 14,202). Then, retail green sukuk with a domestic market share of Rp6.88 trillion.