Deputy Minister Of SOEs Says Energy Transition Needs Cheap Credit Interest

Green economy (photo: dock. Unsplash)

JAKARTA - The government continues to encourage the energy transition in the country. However, to realize the energy transition, it also needs financial support from banks in the form of cheap credit interest to power generation entrepreneurs.

Deputy Minister of State-Owned Enterprises (BUMN) Kartika Wirjoatmodjo admits that there are many challenges faced in realizing the energy transition. Therefore, the government is trying various ways to be resolved.

For example, continued Tiko, in the electricity sector, the government solves short-term challenges by providing incentives to entrepreneurs.

"This electricity has several short-term challenges on how we provide incentives to entrepreneurs who are carrying out business revivals such as coal fires and diesel for energy transition to renewable energy," he said at the 2024 Indonesian Economic Outlook Seminar, in Jakarta, Friday, December 22.

However, continued Tiko, it is not enough for the government. He said, in realizing the energy transition, it also needed financial support from banks through cheap credit interest.

"Of course this is the role of banks in how to provide requirements, direct and provide cheaper interest for power generation (electric) entrepreneurs who want to reduce their emissions in the short term," said Tiko.

"This is what we are starting to enter into banking policy," he continued.

Tiko also revealed that the large-scale question faced was the lack of domestic financing for the long term related to the implementation of solar panels.

"Of course, domestically there is no long-term US Dollar funding source. Therefore, we must maintain international relations," he explained.