Indonesia’s planned push to retire 13 coal-fired plants could face social, funding challenges

[JAKARTA] Indonesia wants to retire 13 coal-fired power plants by 2030, in what could be a decisive move for the country’s decarbonisation efforts, but experts warn it could face substantial challenges, particularly in managing social impact and securing necessary funding.

As the world’s largest coal producer and consumer, with 81 per cent of its electricity generated from fossil fuels, Indonesia’s proposed regulation, announced on Aug 22, is set to become a road map for accelerating the early retirement of coal-fired power plants.

The 13 plants – with a total estimated capacity of 4.8 gigawatts (GW) and producing around 48 million tonnes of CO2 equivalent – are owned by state-owned utility PLN, making them low-hanging fruit for shutdowns compared to those owned by private-sector independent power producers. “We hope to complete it by the end of September. In drafting this legal framework, we must proceed with utmost caution and ensure we have proper legal guidance,” Eniya Dewi, the director-general of new renewable energy and conservation at the Ministry of Energy and Mineral Resources, told The Business Times.