Master Plan for Energy Transition Management Project in Indonesia
This paper is made for the purpose of informing the overview of 1st Stakeholders meeting held in July, 30th 2024 in Jakarta, Indonesia.
[Introduction]
In October 2016, the Indonesian government ratified the Paris Agreement of the United Nations Framework Convention on Climate Change, and announced a goal of zero greenhouse gas emissions by 2060 in the Conference of the Parties in 2021.
In January 2024, supported by the Japan International Cooperation Agency (JICA), “Master Plan for Energy Transition Management Project in Indonesia (hereinafter “the Project”) ” has started entrusted a consortium of experts (hereinafter “JICA survey team”) in Japan in order to study how to achieve stable, affordable, and sustainable electricity supply in Indonesia and achieve Net Zero Emission by 2060 collaborating closely with PT PLN and Indonesian Ministry of Energy and Mineral Resources (MEMR) as our main counterparts in the Project.
The Project consists of studying grid analysis, identification of issues related to power system planning, confirmation of development status and potential analysis of renewable energy, and strategic environmental assessment.
On July 30th, 2024, the first stakeholder meeting (SHM) was held to introduce an overview of the Project and how to proceed with the Strategic Environmental Assessment (SEA) for the development of power sources to achieve decarbonization, attended by government agencies, donors, and research institutions. JICA survey team is planning to hold the 2nd SHM to explain the summary of the SEA in the Project upcoming next June in 2025.
[Summary that was explained in the 1st SHM]
- Indonesia’s Future Electricity Supply and Demand presented by PT PLN
According to “An Energy Sector Roadmap to Net Zero Emissions in Indonesia (IEA)”, Indonesia’s economy is projected to grow at more than 5% per year until around 2030, and it will be on par with today’s developed countries by the mid-2040s, reaching about the same level as Japan’s per capita GDP around 2060.Electricity demand per capita is projected to be 1000 kWh in 2021, 1500 kWh in 2030, and 4400 kWh in 2060 based on the potential for energy efficiency.Comprehensive and rapid sustainable actions must be taken to advance decarbonization while achieving economic growth toward net zero greenhouse gas in 2060. The current dependence on fossil fuels of over 70% needs to be reduced to around 20% by 2060, with renewable energy replacing fossil fuels as the main source of energy, and consumers will also need to strengthen energy conservation and electricity saving measures.
Indonesia has the potential to introduce a wide variety of renewable energy sources.
The domestic renewable energy potential listed in “the National Energy General Plan (RUEN)” published by the Indonesian government in 2017 and the characteristics of each renewable energy source are shown in Table 1. For example, there are many suitable sites for photovoltaic power generation with 208 GW. Next, Hydroelectric power, has 75 GW, and suitable sites are limited.
- Potential of Photovoltaic & Wind power
Renewable energy, which was about 20% in 2021, will grow rapidly from 2030 to 2050, reaching about 90% in 2060. In particular, the supply of renewable energy will also increase, centered on photovoltaic power generation, from 1 GW in 2021 to 20 GW in 2030 and 300 GW in 2050.
Wind power generation is expected to reach 1 GW in 2021 and 90 GW in 2050, with high expectations for offshore wind power in Kalimantan.br />
According to “An Energy Sector Roadmap to Net Zero Emissions in Indonesia (IEA)”, technically feasible photovoltaic power generation is 1500 GW, and similarly onshore wind power generation is 500 GW, and the potential for offshore wind power generation is also large.
- Potential of Hydro power
There are 52,566 potential hydropower plants in Indonesia, with an estimated 94,627 MW of power generation from run-off river systems.
In fact, since there are many technical, environmental, and socioeconomic challenges, it is difficult to realize all of them. And the potential becomes about 75,000 MW. The potential for hydro energy is in Kalimantan, especially in North Kalimantan, and the second is in the mountainous area of Papua Island - Potential of Geothermal power
The potential for geothermal energy is between 24 and 40 GW, of which only 9.81% is utilized. According to “Geothermal Energy Roadmap 2020-2035”, the total installed capacity of geothermal power generation is targeted at 3,575 MW by 2025, 5,486 MW by 2030, and 9,300 MW by 2035.However, most of Indonesia’s geothermal resources are located in forested areas, these areas have been imposed restrictions on geothermal development from the standpoint of forest protection. - Study on Environmental and Social Considerations in Future Electricity Supply
Project implementers are required to assess the environmental impacts of their development projects in accordance with the EIA (Environmental Impact Analysis) procedure.EIA procedure is subject to specific development projects. It does not cover master plans or forward-looking higher-level plans.
The Project is developing a master plan for the power sector, and the EIA for future plans will be analyzed through SEA (Strategic environmental impact assessment) procedure, not by the conventional EIA procedure.EIA is an excellent tool as a method of environmental impact assessment for individual projects.
Project owners basically implement the EIA when they decide to develop certain power generation plants and so on.EIA procedure for a specific project does not consider the overall, cumulative, and synergistic impacts with other projects in a region-wide development plan. There are limitations in considering environmental considerations for the region as a whole in EIA.
Leaving EIA until the project stage means it limits the opportunity to reach more sustainable outcomes, to mitigate risks to the environmental resource which growth and development are based on, and to identify further strategic options.
Implementing environmental assessment at the early stages will lead to considering various development options.
It is a process that can achieve development outcomes while maintaining environmental sustainability over the long term. It can help expedite EIA process for individual projects and rationalize its scope. This means that SEA can hand over the important information to EIA.
Characteristics of SEA are as follows.- SEA is implemented Policy, Plan and Program (PPP) stage that contributes to supporting and improving PPP.
- SEA focuses on the search for best practices and development.
- SEA emphasizes sustainability goals and safeguards. It may integrate the three dimensions of sustainability (environmental, social, and economic).
- SEA can approach development proposals in a proactive manner.
- SEA may focus on broad analysis, between sectors linkages, etc.
- SEA can provide a variety and range of alternatives.
- SEA can provide early warning of cumulative impacts to a sector or region.
- SEA can be related to Poverty and social impact analysis, Conflict/post-conflict and disaster assessment, Country environmental analysis, etc.
We, JICA survey team explain how our SEA will be conducted in the Project.
The objective of SEA is to avoid or reduce significant environmental impacts at an early planning stage. Significant impact is the case where the loss or reduction of conservation target due to direct alteration, etc. cannot be avoided based on the project and regional characteristics.
The results of early planning stage considerations will be used in the EIA stage to (1) explain the project plan, (2) use in scoping, (3) use of survey results (data), (4) use of prediction results, and (5) use in explaining avoidance or reduction of environmental impacts.
The work for SEA is composed of the following four steps.
- Step-1: Gathering information based on desk research
- Step-2: Screening
- Step-3: Scoping
- Step-4: Prediction and Evaluation
Step 1: Gathering information based on desk research
Regarding Gathering information, we collect the information and data from the publicly available materials such as statistical data, EIA reports and documents published by government and research institutions via the Internet, etc.
Step-2: Screening
The screening process in SEA is to clarify and identify the relationship between the proposed project areas and the area (scope) to be considered, such as important natural environment.
Screening work is examined from multiple levels to grasp matters related to environmental impact at an early stage.
For example;
- Areas subject to location restrictions under international treaties, laws, or regulations;
- Areas where development is restricted due to the presence of airports, military facilities, or other critical infrastructure;
- In case of the proposed project area overlaps with designated areas of special social value, such as ethnic minorities or indigenous peoples.
The feasibility of the project will be considerably low.
Step 3: Scoping
In Indonesia, the introduction of CCS in thermal power plants and the development of power sources, mainly hydroelectric, wind, solar, and geothermal power, will be promoted.
In the development of power generation projects, the contents and degree of impact assumed differ depending on the power generation project and the scale of power generation.
Since the Project is the study of an electric power master plan for energy transition, Table 2 summarizes the project characteristics and environmental factors that will be affected by major power supply developments.
Step-4: Prediction and evaluation
In terms of “predicting,” in view of the fact that SEA study is conducted at an early planning stage, it will not involve analysis based on field survey data or detailed simulation studies, but will attempt to evaluate certain projects as quantitatively as possible.
Predictions will be made using a matrix, overlay, case study comparisons, and other methods based on literature sources. For example, the relationship between the critical natural environment, areas to be considered (scope), and the project area should be confirmed by overlay.
The “evaluation” examines the environmental benefits and disadvantages of the project, including an estimate of the environmental impact of the project and the causal relationship between the projects. The avoidance or reduction of significant environmental impacts is considered based on comparisons with evaluation indicators and multiple (alternative) proposals.
| Item | Major Environmental Impacts | Project Characteristics (Sources of Impact/Activity) | Remarks | ||
|---|---|---|---|---|---|
| Thermal Power Plant Project | During construction | Pollution-related: |
|
|
CO2 emissions are expected to be reduced through fuel conversion to hydrogen and ammonia, which do not emit CO2, and through the introduction of CCS, but this is a relatively new technology and there are technical issues to be overcome. |
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
*Land acquisition, resettlement, poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Operation | Pollution-related: |
|
|
||
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
*Poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Hydro Power Plant Project | During construction | Pollution-related: |
|
|
Energy conversion efficiency is high and management costs are low. On the other hand, small- and medium-scale power source development is concerned about environmental impacts associated with large-scale development. |
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
* Land acquisition, resettlement, poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Operation | Pollution-related: |
|
|
||
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
*Poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Wind Power Plant Project | During construction | Pollution-related: |
|
|
Indonesia, which consists of more than 15,000 islands, has the potential for onshore and offshore installations, and is expected to respond to future increases in electricity demand. |
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
* Land acquisition, resettlement, poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services,Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Operation | Pollution-related: |
|
|
||
| Natural environment: | Impact on ecosystems, including flora and fauna (birds, etc.) | ||||
| Social environment: |
*Poverty, indigenous people, ethnic minorities, shadow flicker, land use and local resource use, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Solar Photovoltaic Power Plant Project | During construction | Pollution-related: |
|
|
Indonesia, which consists of more than 15,000 islands, is expected to meet future increases in electricity demand. Floating solar photovoltaic power generation using dam lakes has the advantage of not requiring the acquisition of new land. |
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
* Land acquisition, resettlement, poverty, indigenous people, ethnic minorities, land use and local resource, >Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Operation | Pollution-related: |
|
|
||
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
*Poverty, indigenous people, ethnic minorities, land use (regional division, etc.) and local resource use
|
||||
| Geothermal Power Plant Project | During construction | Pollution-related: |
|
|
Indonesia is the world’s second-largest geothermal power country and is expected to increase demand for electricity in the future. However, it generally takes a long time from the survey to the start of operation. |
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
*Land acquisition, resettlement, poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
| Operation | Pollution-related: |
|
|
||
| Natural environment: | Impact on ecosystems, including flora and fauna | ||||
| Social environment: |
* Poverty, indigenous people, ethnic minorities, land use and local resource use, Water use, infrastructure and social services, Cultural heritage, landscape, working environment, accidents, etc. |
||||
In the 2nd SHM, JICA survey team would like to report on measures to avoid or minimize significant impacts of future power supply development on the natural and social environment, achievement of net zero greenhouse gas in Indonesia in 2060, based on Indonesia’s power supply scenarios.
If you have any comments, please submit them via email and we will refer to them in future surveys.
Please send your comments from January 15th, 2025 to January 30th, 2025 to the following e-mail address.
JICA survey team
SEA group
E-mail: voice_idn_etmp@tepsco.co.jp