The Government Budget Is Only Able To Fulfill 11 Percent Of EBT Funding, Bappenas Urges The Importance Of Blended Financing

Illustration of EBT. (Photo: Doc. Antara/PLN)

JAKARTA - Director of Macro Planning and Statistical Analysis of the Ministry of National Development Planning/Bappenas Eka Chandra Buana said the government budget could only meet 11 percent of the total funding needs for new and renewable energy development (EBT).

"What can be done is the most important, first, we cooperate with the private sector. We have formulated blended financing for investment in EBT development, starting from green bonds, sukuk, and others," he said at the closing of the International Economic Modeling Forum, quoted by Antara, Thursday, November 24.

Regulation also needs to be strengthened to develop EBT technology that requires roadmaps as benchmarks or energy transition targets that are to be achieved in the short, medium, and long term.

He said, in the early stages, the energy transition process has the potential to weaken economic growth, but in the long term this transition process is believed to be beneficial for the environment and economy.

The energy transition needs to be carried out because in the future Indonesia, which is targeted to become a developed country in 2045, must grow higher by developing the manufacturing industry.

At the same time, Indonesia wants to achieve the Nationally Determined Contribution (NDC) target to reduce carbon emissions by 31.89 percent with its own efforts and 43.20 percent with international assistance by 2030.

The energy sector is targeted as a sector that is expected to reduce carbon emissions due to domestic energy demand, especially electricity, which is expected to increase five times from 2020 to 2045, along with efforts to encourage the growth of the manufacturing industry.

"Regarding the increase in energy demand, this will contribute emissions, while most of our energy currently comes from coal. This is our challenge how to switch to using EBT," he said.