Investor interest in Indonesia’s energy transition may suffer after first coal phase-out project scrapped
The policy U-turn contradicts the country’s own commitments, says a think tank
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[SINGAPORE] Indonesia’s decision to cancel its first early coal retirement project involving the Cirebon-1 power plant will likely dampen investor confidence in the country’s energy transition, say sustainable finance observers.
“Because the Cirebon deal was structured around private financing, its cancellation could erode private-sector confidence in similar deals involving PLN-owned plants or independent power producer plants selling to PLN,” said Tiza Mafira, director of Climate Policy Initiative’s (CPI) Indonesia chapter.
The country’s state-owned utility company PLN recently announced that it is scrapping plans to bring forward the shutdown of the 660-megawatt Cirebon-1 coal-fired power plant, citing extremely high costs.
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