Indonesia chalks out plan for low-carbon economy

Gas and petrol to be prohibited in new, sustainable capital on Borneo Island


Abdulla Mohamed Al-Riyami

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Husain Bagi, the Indonesian Ambassador to the UAE. 24 October 2023. Photo by Shihab
Husain Bagi, the Indonesian Ambassador to the UAE. 24 October 2023. Photo by Shihab

Published: Wed 22 Nov 2023, 8:03 PM

Last updated: Thu 23 Nov 2023, 8:13 AM

Indonesia, the world's fourth most populous country, is on a mission to overhaul its energy landscape, which currently relies on coal for 60% of its power generation. The nation has set an ambitious target to achieve 23% renewable energy usage by 2025, doubling its current 12%. Despite being a developing nation, Indonesia is taking bold steps to transition to a low-carbon economy, positioning itself as a leader in addressing climate change.

Indonesian Ambassador to the UAE, Husain Bagis, affirmed this commitment, saying, "Indonesia is resolute in its plans, and we're taking action now." He also highlighted the plan to relocate the capital city from polluted Jakarta to a new, sustainable capital on Borneo Island, scheduled for completion by 2024. In the new capital, gas and petrol will be prohibited, underscoring Indonesia's dedication to decarbonisation—a significant milestone for the country and the global community.

Jakarta, Indonesia's current capital, starkly illustrates the nation's climate vulnerabilities. The city, as Ambassador Bagis noted, is sinking rapidly into the Java Sea, a consequence of unregulated groundwater extraction and the increasing threat of rising sea levels. Alarming estimates suggest that as much as one-third of the city could be underwater by 2050.

While acknowledging the difficult road ahead, Bagis unequivocally asserted Indonesia's commitment to real climate pledges. "Indonesia has a clear plan of following what it says and working towards it."

Furthermore, Ambassador Bagis underscored the critical implementation challenge, noting that developing the necessary infrastructure is a top concern in Indonesia.

He pointed out that the primary obstacle is the country's geographic complexity, characterised by its vast expanse of more than 17,000 islands. This complexity presents significant hurdles when coordinating and executing national climate policies.

However, the Ambassador expressed optimism by highlighting that Indonesia's new capital city, which commenced construction last year, will serve as a sustainable model that can be duplicated across the archipelago. This development is seen as a significant step in overcoming the logistical challenges posed by the country's unique geography.

Beyond relocating the capital, Indonesia is promoting sustainability through various avenues. Ambassador Husain expressed hope that the upcoming COP28 climate summit in Dubai would lead to commitments from developed nations to fund climate efforts in developing countries like Indonesia. He also noted that many major Indonesian companies are embracing ESG principles and exploring ways to contribute to climate initiatives through carbon trading and renewable energy projects. "Indonesia's private sector is becoming more sustainability-conscious, with large companies actively seeking ways to participate in climate change programmes, focusing on how they can contribute to Indonesia's sustainability goals," he said.

Bagis noted that Indonesia is actively working on a mangrove project, and he praised the UAE for its diverse range of initiatives, which span from renewables to nature-based solutions.

Additionally, Bagis touched on how Indonesia is collaborating with UAE sustainability leaders like Masdar on multiple renewable energy projects surrounding solar and geothermal energy. The most recent agreement he highlighted is the second phase of the 'Cirata Plant,' which is expected to boost the country's power plants by 500 Megawatts.

However, this doesn't overshadow Indonesia's significant dependence on coal, accounting for 60% of its electricity generation across its vast archipelago.

Ambassador Bagis stressed that President Joko Widodo is aware of these challenges and has a comprehensive plan to phase out coal gradually. Indonesia has recently excluded off-grid coal plants from its $21.5 billion climate aid package.


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