Just Launched, CIPP JETP Is Considered Not To Maximize Support For Green Energy Transition

Executive Director and Economist Center of Economics and Law Studies (Celios) Bhima Yudhistira. (Photo: Theresia Agatha/VOI)

JAKARTA - The Civil Society Organization (CSO) Coalition assesses that the draft investment plan and comprehensive investment and policy plan (CIPP) is still half-hearted in equitable energy transition efforts.

This is motivated by the lack of early retirement target of PLTU in this draft plan and has the potential to slow down the reform of Indonesia's energy system to be greener and more ambitious.

Executive Director and Economist of the Center of Economics and Law Studies (Celios), Bhima Yudhistira said, the CIPP JETP document is still quite contradictory.

According to him, the target of the renewable energy mix in CIPP is quite ambitious, reaching 44 percent by 2030.

But on the other hand, only two PLTUs are included in the early retirement list in this scheme, namely the Peltu Pelabuhan Ratu and PLTU Cirebon.

Some of the PLTUs that entered early retirement, namely the Cirebon-1 PLTU, have actually been included in the energy transition mechanism (ETM) scheme. So it seems as if there is no intention to actually close the coal power plant. JETP became unclear, at first wanting to retire, the coal power plant was not carried out seriously," he said in a statement to the media, Tuesday, November 21.

Meanwhile, Director of the Clean Transitional Program Harryadin Mahardika added that Indonesia had done the same thing.

In the National Energy General Plan (RUEN) published in 2014, Indonesia targets an energy mix of 23 percent by 2023 and 31 percent by 2050.

However, at the same time, Indonesia also started the 35 Gigawatt (GW) Program, the majority of which were coal power plants.

The addition of PLTU has finally eroded the space for developing renewable energy, so that the target of the green energy mix has not been achieved.

In the CIPP document, the PLTU captive was not included. In fact, the growth was very high from 1.3 GW in 2013 to 10.8 GW in 2023, and it will continue to grow. This will be a big barrier that can thwart Indonesia's zero emission target as before. Even though the CIPP target is reached 100 percent, Indonesia's zero emission target will never be achieved because PLTU captive will continue to produce large amounts of emissions," explained Harryandi.

On the other hand, Rise! Indonesia, Dian Sunardi also admitted that he was disappointed with the proposed fake solution technology in CIPP documents, such as biomass co-firing.

The reason is, fake solutions are proven to be ineffective in reducing emissions.

In fact, the existence of fake solutions actually enriches a handful of individuals, promotes privatization and codification of ecological resources, and frees corporations that contribute to the climate crisis (polluters) from their responsibilities.

"And most importantly, it will exacerbate the climate crisis and undermine the future of Indonesia's energy transition. Indonesia must take a firm stance, state that it is not a fake solution and remove it from CIPP," said Dian.

The CSO Coalition also highlighted the portion of debt and grants in JETP funds. Bhima said that funding from developed countries or the International Partners Group (IPG) strongly does not uphold the principle of justice. Mainly, the United States, which has a very large number of non-consensional loans. This means that Indonesia will bear loans with market interest.

"What is the function of waiting for the CIPP JETP document to be released if the agreement with developed countries is only normal, is it still a business as usual loan?" said Bhima.

The Coordinator of the AEER Association Pius Ginting stated that the JETP Secretariat and the Indonesian Government must strive to increase the portion of grants in funding JETP. Japan as a member of the IPG needs to increase the responsibility of funding in the form of grants, given its role in investing in PLTU in Indonesia, as a coal export market, and its contribution to transportation sector emissions where most of the vehicles in the market are still related to Japanese investment.

"A better attitude given by Germany by allocating 167 million US dollars in grants or technical assistance or 10 percent of the amount of public funding by Germany. The portion of this amount of grant should also be a reference for other IPG countries as an implementation of the principles of common but differentiated responsibility in funding to overcome planets that are getting hotter," he said.

Not only that, Bhima underlined the absence of various fiscal and monetary policy reforms to be implemented immediately. In fact, JETP is expected to bring about changes to the fiscal and monetary policy framework that supports the acceleration of coal-fired power plants.

"We have not seen the technical steps needed to shift fiscal incentives in the mining and oil and gas sectors to make the fossil business economically less attractive than renewable energy. In terms of taxation, it is also untouched, so this JETP actually shows uncomprehensive discussion brokers. The time for the revision of CIPP JETP is expected to unite all aspects of government policies that must be changed as soon as possible," he said.

Needs to take sides with the community

Di sisi lain, Direktur Program Koaksi Indonesia Verena Puspawardani mengingatkan bahwa dokumen CIPP perlu terus dikawal agar menjadi rekomendasi yang kuat bagi Satuan Tugas Transisi Energi Nasional.

This can be done by involving various stakeholders, community participation, and embracing local governments in managing the energy transition fairly by mapping policies up to the regional level.

In addition, the implementation of gender equality, disability, and social inclusion (GEDSI) must also be a basis that prioritizes various vulnerable groups and affected communities.

The CIPP document, he said, also acknowledges that the energy transition will encourage the creation of green jobs, as well as taking into account the potential for lost jobs and mitigation measures.

For this reason, he continued, increasing worker capacity is important so that it can still be absorbed in the renewable energy ecosystem.

In addition, other industrial sectors need to be developed to reduce the impact of rising new unemployment.

Regarding green jobs, the government already has the initiative to advance green jobs with roadmaps. This needs to be included in CIPP documents to strengthen national and regional policies so as to ensure that the policy is utilized," said Verena.