Indonesia’s renewable energy bill: An ambitious attempt at energy transition

THE Indonesian government is preparing to pass a new energy and renewable energy bill known officially as Rancangan Undang Undang tentang Energi Baru dan Terbarukan, or RUU EBT. This will create a regulatory framework for renewable energy projects that incentivises the transition to green energy. While better late than never, RUU EBT has some shortcomings and missed opportunities that are worth examining.

During COP21 in 2015, the Indonesian government set policy targets to increase the use of alternative energy sources. As of 2021, Indonesia’s renewable energy generation capacity stands at 11.4 per cent and is still far behind the mandated minimum target of 23 per cent by 2025, despite the fact that Indonesia is on the frontline of climate change.

This must be considered in light of recent events where the European Union and several G20 governments signed a non-binding declaration at the Nov 15 G20 summit, pledging up to US$20 billion to help Indonesia phase out coal-fired power plants (CFPPs) and achieve net-zero emissions in the power sector by 2050. This supports the newly-enacted Presidential Regulation 112/2022, which mandates the development of a road map to retire CFPPs earlier.