PLN and Partners Develop Pathways to Implement the Just Energy Transition Partnership

From June 6 to June 9, 2023, PLN and the International Energy Agency (IEA) participated in a Joint Modeling Session in Jakarta, Indonesia to develop consolidated energy transition pathways to achieve the Just Energy Transition Partnership (JETP)’s goal to support a global trajectory consistent with keeping the 1.5 °C global warming limit within reach. This activity is part of PLN’s cooperation with IEA to finalize the Just Energy Transition Partnership Investment and Policy Plan (JETP IPP) in accelerating Indonesia’s energy transition, marked by a memorandum of understanding signed by both parties in April 2023 in Paris, France.

The group developed an energy model with scenarios that can decarbonize Indonesia’s energy sector while maintaining PLN’s financial sustainability. The energy model will be part of the JETP Investment and Policy Plan expected to be released in August 20203. For each scenario, the energy model quantified Indonesia’s energy mix, CO2 emissions reduced, investment required, among other things.

With support from international partners, the JETP IPP will lay out significant new targets and policy reforms needed to reduce GHG emissions and support impacted communities by:

• Peaking total power sector emissions by 2030, shifting the projected emissions peak forward;
• Capping power sector emissions at 290 MT of CO2 in 2030, down from the baseline value of 357 MT CO2;
• Establishing a goal to reach net zero emissions in the power sector by 2050, bringing forward Indonesia’s net zero power sector emissions target by ten years; and
• Accelerating the deployment of renewable energy so that renewable energy generation comprises at least 34 percent of all power generation by 2030, roughly doubling total renewables deployment over this decade compared to current plans.

For Indonesia to achieve these new targets and policies, JETP intends to mobilize an initial $20 billion in public and private financing over a three-to-five-year period, using a mix of grants, concessional loans, market-rate loans, guarantees, and private investments. Indonesia recognizes the need for enhanced financing to pursue the JETP targets, additional sources of sustainable financing and the inclusion of international partners to leverage existing international initiatives, e.g., the G7 Partnership for Global Infrastructure and Investment.

PLN collaborates with the JETP Technical Working Group led by IEA with support from the Asian Development Bank, the Rocky Mountain Institute, the Institute for Essential Services Reform, the Danish Energy Agency, and the World Bank.

To learn more about PLN’s memorandum of understanding with IEA on JETP, read the press release. For more information PLN’s presentation on JETP in Paris, France in April 2023, read the press release.