Socially Inclusive Sustainable Energy Transition for Provinces in Indonesia

The funding for the project is part of a proposed three-year Danish contribution to support UNEP Copenhagen Climate Centre (UNEP-CCC) located in the UN City Copenhagen.

Alongside energy transitions and long-term energy planning pathways adopted by countries, it is equally important to focus on the just, inclusive and the developmental aspects of such transition. Just transition entails a systemic view of the opportunities and challenges, an effective dialogue and engagement with relevant actors. This means putting considerations of employment, equity, inclusion, affordability, and sustainable economic development at the centre of the transition process.

These are especially critical in the South-East emerging economies that are embarking simultaneously on multiple energy and developmental transitions. Indonesia plans to achieve net zero emissions by 2060. It aims to generate 34% of electricity from renewables by 2030. It signed the Just Energy Transition Partnership (JETP) in 2022, aiming to stabilize emissions by 2030. Despite plans to stop new coal plants by 2023, this would still mean an addition of 35 GW as per the current plan, and continued investments into natural gas extraction and transportation. New electricity regulations (PR 112), aim to resolve tariff issues (renewables) and introduce tenders. Such energy transitions need to be sensitive to multi-faceted concerns and spillover impacts (including negative impacts) on socio-economic livelihoods, on jobs and skills, on new IPPs and SME landscape, on vulnerability and marginalisation, on local content and manufacturing capabilities, on revenue streams and income losses, and on finance flows and NDC implementation.

To make the energy transition as sustainable and impactful as possible, it is evident that activities need to integrate social and just considerations into mainstream policies, plans, decision-making criteria, and reflect in the country’s NDCs, both in the plans as well as in the implementation as well. The objective of this grant is to enable and support in this process at a local level, in select provinces in Indonesia.