Countries mobilise $20 billion to move Indonesia away from coal

Single largest climate finance transaction or partnership ever, says US Treasury

NUSA DUA/ SHARM EL-SHEIKH:

A coalition of countries will mobilise $20 billion of public and private finance to help Indonesia shut coal powerplants and bring forward the sector’s peak emissions date by seven years to 2030, the United States, Japan and partners said on Tuesday.

The Indonesia Just Energy Transition Partnership (JETP), more than a year in the making, “is probably the single largest climate finance transaction or partnership ever”, a US Treasury official told reporters.

The Indonesia JETP is based on last year’s $8.5 billion initiative to help South Africa more quickly decarbonise its power sector that was launched at the COP26 climate summit in Glasgow by the United States, Britain and European Union.

To access the programme’s $20 billion worth of grants and concessional loans over a three- to five-year period, Indonesia has committed to capping power sector emissions at 290 million tonnes by 2030, with a peak that year. The public and private sectors have pledged about half of the funds each.

Indonesia has also set a goal to reach net-zero emissions in its power sector by 2050, a decade before its current target in its national climate plan, and to double the pace of renewable energy deployment so that it accounts for at least 34% of all power generation by 2030.

“We’ve built a platform for cooperation that can truly transform Indonesia’s power sector from coal to renewables and support significant economic growth,” US Special Envoy on Climate Change John Kerry said.

Published in The Express Tribune, November 16^th, 2022.

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