Japan And Indonesia Accelerate Energy Transition Through JETP And ETM

PT PLN (Persero) has finalized the Just Energy Transition Partnership (JETP) scheme in collaboration with Japan to accelerate the execution of energy transition projects, one of which is by adding new and renewable energy plants (EBT) in Indonesia and retiring steam power plants (PLTU).

PLN President Director Darmawan Prasodjo during his visit to Japan explained that PLN has carried out many agendas to be able to reduce carbon emissions, one of which is by retiring the PLTU. In line with that, PLN has postponed 14.2 new PLTU GWs that should have entered the system and replaced them with EBT-based generators.

"Our strategy and steps in reducing carbon emissions have proven to be real. Through various efforts that we have made and will do, we are targeting a reduction in emissions of up to 9.8 million tons of CO2 by 2030," Darmawan said in a written statement, Tuesday, March 7.

Darmawan also explained that the efforts to reduce emissions carried out by PLN today are through co-firing technology at 52 PLTU owned by PLN. Until 2025, PLN needs up to 10.2 million tons of biomass to be able to meet the co-firing needs.

PLN will also develop an EBT plant and will dominate the energy mix of up to 52 percent. PLN will build 10.4 GW of Hydroelectric Power Plants (PLTA), 3.4 GW of Geothermal Power Plants and 4.7 GW solar PV.

"This requires a large amount of investment and requires joint collaboration with the global. This is because the efforts to reduce emissions that we are doing have a direct impact on reducing emissions in Japan, Europe and even America," said Darmawan.

Director of Energy Conservation of the Ministry of Energy and Mineral Resources (ESDM), Gigih Udi Atmo who is also a representative of the JETP Secretary emphasized that PLN needs funding support and program cooperation to be able to maximize carbon emission reduction.

PLN needs a large investment to be able to run this energy transition program. For this reason, through the initiation of the G20 countries, a JETP Secretary is formed under the Ministry of Energy and Mineral Resources. Through this JETP task force, both the Indonesian government, PLN and also the G20 countries, in particular Japan will map out projects and investment needs in reducing carbon emissions.

"We will complete a very comprehensive investment plan in August this year. We and PLN will identify potential projects for this energy transition," Gigih said.

Gigih also assessed that in choosing financing later through the government's JETP and Energy Transition Mechanism (ETM) mechanisms as well as PLN, it will prioritize cheap financing. Global support in providing cheap financing or expanding the portion of grants is the middle way in the success of this energy transition agenda.

"Of course, with a promising return to investment and also affordability that requires real support from the global side," said Gigih.

Deputy Commissioner for International Affairs, Ministry of Economy, Trade and Industry of Japan, Izuru Kobayashi also did not deny the big challenges between Indonesia and PLN in carrying out this energy transition project. Kobayashi invites all parties to be able to support the energy transition in Indonesia.

"The initial steps taken by Japan in assisting Indonesia in completing the energy transition project are expected to be followed by the steps of other parties as a joint effort to achieve the NZE target," said Kobayashi.