Press Release

The Urgency of Renewable Energy Transition in Indonesia

Energi Terbarukan Kebijakan Publik
11-01-2021 , Posted - Adminitrators

In the past five years (2015-2019), global energy transition with renewable energy (RE) has been developing rapidly. In the year 2019 International RE Agency – IRENA recorded an increase of 72% of new installed capacity of RE (or 176 gigawatts – GW) of IRENA’s entire electricity plant expansion (IRENA, 2020a). It had become the fifth consecutive year where 50% of global new power plants come from clean energy. Bloomberg New Energy Finance (BNEF, 2020) reported that a decrease of capital expense in wind and solar technology have made the two technologies dominate the investments of clean energy as much as 95% (US$269,3billion) in the year 2019. On another side, energy efficiency on appliances and buildings has become global norm and standard as an effort to reduce energy consumption rate.

Technology advancement and digitalization in energy sector have stimulated energy system transition process rapidly and support energy system modernization process. Technology innovation which enable electricity supplied with 100% RE by the mid of the century will be a probable scenario (Ram, et al., 2019). From business perspective, this advancement has also encouraged change in how energy and electricity companies run their business (Global Commission on the Geopolitics of Energy Transformation & IRENA, 2019).

The question for Indonesia: How can this country benefit from the competitiveness of the reduced expense of RE in order to accelerate RE transition in this nation? Have current policy and plans support the needed transformation? How does Indonesia contribute to Paris Agreement target achievement and Global Sustainable Development Target of the 2030 Agenda?

Opportunities and threats of global energy transition wave need to be anticipated and handled well by key stakeholders in energy and electricity sector through better awareness and understanding on the current trend and its consequences. This article covers the importance of energy transition in Indonesia by emphasizing transition in electricity sector into a modern, reliable and low carbon system (and even zero carbon) in 2050. This article also explores how and what things need preparing in the next five years.