Indonesia Unveils $20 Billion Renewable Energy Investment Initiative For Power Sector Decarbonization

Representational image. Credit: Canva

Indonesia launched its investment strategy on Tuesday, aiming to utilize $20 billion in pledged financing from global lenders, predominantly led by the United States and Japan, to expedite the decarbonization of its power sector.


The Just Energy Transition Partnership (JETP) seeks to reduce carbon dioxide emissions to 250 million metric tons in its on-grid power sector by 2030, compared to an estimated 350 million under business-as-usual scenarios.


The Comprehensive Investment and Policy Plan (CIPP), outlining the investment proposal, was officially introduced following a public consultation, with Indonesia aiming to increase the share of renewable energy in its power generation to 44% by 2030.


The plan requires investments totalling $97.3 billion, with $66.9 billion allocated for 400 projects set to commence by 2030. While the JETP funding is expected to catalyze energy transition investments, concerns have been raised about the reliance on commercial loans in the funding mix, with half of the funds pledged coming from private financing.

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