Wow, The Indonesian Economic Condition Will Be Disturbed If You Don't Do The Energy Transition

Migas (photo: intermediate)

JAKARTA - The Coordinating Ministry for Maritime Affairs and Investment (Kemenko Marves) stated that if Indonesia does not make an energy transition, domestic economic conditions will be disrupted.

"For Indonesia itself, of course, climate issues and transitional energy are very, very critical, can have an impact from an economic perspective. If we don't have transitional energy, our economic conditions will certainly be disrupted," said Deputy for Infrastructure and Transportation Coordination at the Coordinating Ministry for Maritime Affairs, Rachmat Kaimuddin, quoting Antara.

Currently, developed countries such as Europe are said to have made Carbon Border Adjustment Mechanism (CBAM). This means that if the competitiveness of Indonesian products is not driven by an energy transition, then goods originating from the country will become more expensive or uncompetitive.

According to him, the energy transition provides many potentials and benefits to the economic sector. For example, one of the aspects of the ESG concept (Environmental, Social, and Governance) which emphasizes the urgency of the company to practice various sustainable programs.

"ESG sometimes we consider this a cost, but actually in the future it can be an investment and maybe (if the company) does not do the ESG, even (the costs incurred) will become more expensive because the economic impacts will become even more expensive if we don't comply. So, it's better that we obey now, maybe more efficient, maybe more useful for us," said Rachmat.

He emphasized that countries such as Indonesia must be independent in energy resilience, because it is very dangerous if it depends on the energy imported from abroad. Although now Indonesia is still exporting fossil energy, coal, and other unrenewable energy commodities, energy transitions must be prepared to match the times.

"Currently we are importing 60 percent of our fuel (oil fuel) for transportation. So this is also a risk if we don't have domestic power. Not to mention in the future even though we use renewable energy (new renewable energy), we have to make sure we have a supply chain (soking chain) in Indonesia. If not, later we don't want to use solar panels but we have to import a little bit," he also said.