Energy Transition, Minister Of Finance Asks IPG To Be More Proactive

Minister of Finance Sri Mulyani Indrawati (ANTARA)

JAKARTA - Finance Minister Sri Mulyani Indrawati attended a discussion held by the Global Energy Alliance for People and Planet (GEAPP), South Africa's Presidential Climate Commission, World Resources Institute (WRI) and supported by the World Bank on Wednesday, April 17 local time.

Sri emphasized the importance of the proactive attitude of member countries of the International Partners Group (IPG) and member countries of the Just Energy Transition Partnership (JETP) to realize a just energy transition.

"We really need the proactive role of all parties so that the coordination of IPG member countries and intermediate financial institutions, is smoother, and more cohesive, making it possible to realize synergy, responsive to overcome challenges, and maximize collective efforts," Sri Mulyani said in a statement in Jakarta, Friday, April 19.

Indonesia has a JETP Indonesia collaboration program which is funding for the acceleration of a just transition whose funding comes from IPG and private public funds through The Glasgow Financial Alliance for Net Zero (GFANZ).

"JETP is one of the results of Indonesia's real achievements at the G20 Presidency Summit in Bali in 2022," said the Minister of Finance.

The Minister of Finance revealed that collaboration with IPG in developing JETP Comprehensive Policy and Investment Plans in Indonesia had been launched in November 2023.

The collaboration has an ambitious target, such as reaching a renewable portion of energy of 44 percent of the national energy mix in 2030 and achieving net-zero emissions for the electricity sector by 2050.

The Minister of Finance also discussed the funding structure, where there is a grant portion of 3 percent of the commitment of public funds, and about 60 percent of it is soft loans. I emphasize the need for soft funding, simplification of access, and the importance of maintaining transparency and accountability," he said.

In addition to collaboration with JETP, Indonesia also has funding that can be channeled through PT Sarana Multi Infrastruktur (PT SMI) in order to carry out the task of realizing the Energy Transition Mechanism (ETM) Country Platform for the national energy transition.

Meanwhile, as a catalyst fund, Indonesia proposes that JETP funding can be channeled through the ETM-Country Platform. Indonesia also sees good progress, such as several projects that are prioritized and targeted in 2024 within the framework of JETP.