ESDM: Transition to Renewable Energy to Be Gradual, Coal Remains a Competitive Energy Source

JAKARTA, investortrust.id – Satya Hangga Yudha, an expert staff member of the Minister of Energy and Mineral Resources, believes that Indonesia is capable of transitioning from fossil fuels to new and renewable energy to meet its carbon emission targets. However, the transition will be gradual, with a mix of fossil and non-fossil energy sources remaining in use.

According to Hangga, the energy transition process is being carried out based on national capabilities and in line with standards applied by developed countries. "The energy transition must be gradual. We are shifting to new and renewable energy, but coal remains a competitive and affordable energy source," Hangga stated in Jakarta on Wednesday, Jan 29, 2025, as reported by Antara.

He emphasized that to ensure consistent carbon emission reductions from coal-fired power plants, co-firing with biomass is necessary. "In the future, we will utilize carbon capture and storage and carbon capture, utilization, and storage (CCUS) technologies," he added.

Hangga noted that by 2040, over 100 gigawatts (GW) of energy capacity will be developed. Of this, 75% will come from renewable energy, 5 GW from nuclear, and 20 GW from gas.

The former oil and gas commercialization analyst at SKK Migas expressed hope that the Presidential Decree on the National Energy Resilience and Downstreaming Task Force, Minister of Energy and Mineral Resources Bahlil Lahadalia, would boost investment, downstreaming, economic growth, and the added value of Indonesian commodities.

"Indonesia must transition from fossil fuels to new and renewable energy to achieve the Paris Agreement 2030 targets and net-zero emissions (NZE) by 2060. Coal phase-down is crucial, but solutions must be in place," he stressed.

Hangga explained that while coal-fired power plants will be phased out, they must be replaced. Affordable and accessible energy sources that can serve as base loads include co-firing with biomass, gas, and EBT.

"The Minister of Energy and Mineral Resources has issued a regulation on B40 (biodiesel), and we hope it will be implemented effectively. Next year, the target will increase to B50 and eventually reach B100," he said.

This gradual approach underscores Indonesia's commitment to balancing energy security, economic growth, and environmental sustainability in its transition to renewable energy.