Energy Transition Maintains Indonesia's Competitiveness In The Eyes Of The World

Energy transition illustration (photo: Unsplash)

JAKARTA - The energy transition carried out in Indonesia aims to maintain Indonesia's competitiveness in the eyes of the world. This is considering that soon the global trade era will change by including sufficient detailed conditions related to the products produced.

"I heard that Europe will start implementing its carbon border tax in two years. It will not take long for 2026 for an industry to ensure that later it will be able to enter there," said Secretary General of the Ministry of Energy and Mineral Resources (ESDM) Dadan Kusdiana quoting Antara.

Dadan said the energy transition program is also in line and supports other government programs, for example for downstreaming. Encouraging downstreaming in this era is very important related to the competitiveness of the products produced. If companies in Indonesia are unable to show their products are produced in green ways, they will be subject to a carbon tax which will certainly make product prices even higher.

"So in the future, the product will be asked what the energy process will be like. Later there will be a maximum limit that can be passed but produce a carbon tax so that the goods will have additional costs, the price will be added. For example, if there is the same item out of Vietnam, he has already applied the ESG principles (environment, social, governance) and green are appropriate, so the costs are not added with the same goods. So already know which one to choose, this is related to competitiveness," explained Dadan.

In addition, the energy transition also encourages equitable development because with EBT green-based industries can be built. Dadan explained that in the Papua region, for example, it has the largest hydro potential but has not yet been worked on. Even though it could be an opportunity to build a low-emission industry.

"The potential of the largest hydropower plant there (Papua) has always been there, only no one has used it. Then in Marauke the potential for big winds. If we develop it, Papua is indeed heading like old Java, because that's the encouragement so that there is an industry there," said Dadan. when giving a speech at the Energy and Mining Editor Society (E2S) Award 2023 and a discussion themed Energy Transition in Indonesia: Perspective and Opportunities for Management of the Fair Energy and Mineral Resources Sector in Jakarta, Friday (12/1/2024).

On the same occasion, President Director of PT Pertamina Geothermal Energy Tbk (PGE) Julfi Hadi said that in the last two years the development of geothermal has progressed in line with the energy transition program promoted by the government. Julfi Hadi said that Indonesia is a country with abundant geothermal resources.

Indonesia has the largest recipient, the largest in Java and Sumatra. Geothermals can play a strategic role in the energy transition. The price can compete," he said.

Julfi emphasized that geothermal energy can be a source of energy for baseload power plants that can replace coal. In this case, he said, the government has made efforts to create a good ecosystem. Therefore, it is necessary to make efforts to replace the business model so that the development of geothermal energy is more optimal.

Dharma Djjonegoro, Director of PT Adaro Power, revealed that currently Adaro is developing a large green industry park in North Kalimantan (Kaltara) on an area of 16,000 hectares. In addition, a battery power plant will also be built in South Kalimantan.

We are also building an aluminum smelter at Kaltara Industrial Park, gradually to 1.5 million tons. Singapore needs renewable power, this is good for Indonesia. It is hoped that this project can break eggs, it can be used to build the manufacturing industry," he said.