Sri Mulyani: It Takes IDR 3,500 Trillion To Provide Electricity From Green Energy

Minister of Finance Sri Mulyani. (Photo: Doc. Antara)

JAKARTA - Minister of Finance (Menkeu) Sri Mulyani Indrawati said Indonesia needs around 243 billion US dollars or around Rp. 3,500 trillion to provide electricity from new and greener renewable energy.

"It takes 243 billion US dollars to achieve the nationally determined contribution target (NDC). This is only for the electricity sector," said Minister of Finance Sri Mulyani in the webinar "Sustainable Finance: Instruments and Management in Achieving Sustainable Development in Indonesia", quoted from Antara, Wednesday, July 13.

A budget equivalent to IDR 3,500 trillion is needed to achieve Indonesia's NDC target of reducing carbon emissions by 29 percent with its own efforts, and 41 percent with international assistance by 2030.

To achieve the NDC target of 29 percent, the electricity sector needs to reduce carbon emissions by up to 314 million tons of carbon dioxide equivalent.

"This figure makes the electricity sector the second largest contributor to carbon emission reductions after the forestry sector," said Sri Mulyani.

Meanwhile, to achieve the NDC target of 41 percent, the electricity sector needs to reduce carbon emissions by up to 446 million tons of carbon dioxide equivalent by 2030.

"Funding to reduce carbon emissions will not only come from government money. The government will play a role, but the role of the private sector and international financing is also important," said Sri Mulyani.

For this reason, the government is currently still preparing the technical imposition of a carbon tax to provide incentives for business actors who have succeeded in reducing carbon emissions. The government is also still discussing the most equitable carbon price.

"Unfortunately the global carbon market does not have a universal carbon price. This is a serious debate at the meeting of Finance Ministers of G20 member countries regarding a fair carbon price that reflects different general responsibilities," said Minister of Finance Sri Mulyani.