Coal barges are pictured as they queue to be pull along the Mahakam River in Samarinda, East Kalimantan province, Indonesia. - Reuters
JAKARTA (Vietnam, News/ANN): Indonesia needs a grant of about US$1.5 billon (RM7 billion) from the International Partnership Group (IPG), including the US, Japan, Canada, Denmark, the European Union (EU), France, Germany, Italy, Norway and the UK to terminate coal mining and production under the Just Energy Transition Partnership (JETP)'s framework.
Executive director Indonesian Institute for Essential Services Reform (IESR) Fabby Tumiwa said the institute cannot take on debt for energy and coal mining termination programmes. In case of having to take on debt, preferential financial sources must ensure an interest rate of less than 3%.
Last year, at the G20 Summit in Indonesia, IPG pledged to raise US$10 billion in public funds over three to five years as part of a JETP plan to help Indonesia remove coal in production.
Financial institutions in the Glasgow Financial Alliance for Emission Reduction (Gfanz) have also pledged 10 billion USD, bringing the JETP programme a grant of up to 20 billion USD.
However, Indonesian Ministry of Energy recently said that the country will receive about 160 million USD in funding from JETP. This amount is too modest compared to the 20 billion USD committed under the JETP framework.
Meanwhile, about half of the 20 billion USD is expected to come from commercial loans.
Indonesia is currently drafting a comprehensive investment plan for the JETP programme. The document will be released in August.
The document will provide details on the number of coal-fired power plants that Indonesia will have to shut down for a specified period of time.
