海角大神

In Indonesia鈥檚 region of East Kalimantan, the country鈥檚 dependence on coal is on full display.

Driving on the region鈥檚 toll road, passersby can watch excavators digging coal from shallow pits as trucks filled with the carbon-rich rocks rush by. Under a bridge in Samarinda, the region鈥檚 capital, hundreds of mammoth, jet-black mountains of coal sit in barges being pulled along the waterway, headed to plants across Indonesia or other countries.

They鈥檙e sights that Indonesia has pledged to phase out 鈥� or at least drastically reduce 鈥� by agreeing to some five schemes with international stakeholders, including the largest-signed $20 billion Just Energy Transition Partnership deal. While the deals aim to turn one of the largest coal-producing countries toward its vast greener energy sources, experts warn that financial, policy, infrastructure, and other challenges need to be overcome.

Indonesia鈥檚 energy transition is 鈥渧ery unique鈥� because of high economic growth, geography, population centers, and clean energy potential, said David Elzinga, a principal energy specialist at the Asian Development Bank.

Despite Indonesia鈥檚 energy potential from solar, hydropower, geothermal, wind, and other sources, only some 12% of them are tapped, according to the International Renewable Energy Agency. Nearly all energy demand is met by fossil fuels, with 60% coming from highly polluting coal.

That means people like boat maker Jembong, who like many Indonesians uses only one name, can rely on solar for a lightbulb or to watch television. But for the energy-intensive power tools he uses to handcraft boats from his home on Karampuang Island, he needs diesel.

鈥淚f I can鈥檛 use the diesel engine, I can鈥檛 work,鈥� he said.

It鈥檚 impacted the environment: In 2021, Indonesia鈥檚 energy sector emissions were around 600 million tons of carbon dioxide, the world鈥檚 ninth highest, according to the International Energy Agency. And population and economic growth are expected to triple the country鈥檚 energy consumption by 2050.

鈥淚t鈥檚 a challenging environment to make change while you have such substantial growth,鈥� said Mr. Elzinga. 鈥淚t is different than a developed country which is characterized by having significant financial resources and low economic growth.鈥� Many more-developed economies have stronger renewable ambitions, though researchers say no country is currently in line with global climate goals.

Indonesian officials have signaled they鈥檝e started the shift: They鈥檝e announced new regulations around solar, set a goal to raise the market share of electric vehicles in Indonesia to 25% of total vehicle sales by 2030 and have deployed charging stations. But experts warn Indonesia is lagging behind its Southeast Asian peers.

Indonesia has voiced it needs help from more-developed nations.

鈥淲e don鈥檛 want to be limited in terms of our ability to grow economically,鈥� said Deputy Coordinating Maritime Affairs and Investment Minister Rachmat Kaimuddin. 鈥淚ndustrialized nations can support us.鈥�

With the new JETP deal, Indonesia will aim to reach net zero emissions from the power sector by 2050, bringing forward its target by a decade, and reach a peak in those emissions by 2030. It鈥檚 increasing its target for renewable energy to make up over a third of all power generation by 2030, which would mean doubling the pace of current deployment.

But financing remains an obstacle, said Elrika Hamdi, an Indonesia-based energy finance analyst at the Institute for Energy Economics and Financial Analysis. By one estimate, Indonesia will need up to $2.4 trillion in cumulative investment across the energy system by 2050 鈥� a number far larger than the money currently pledged.

鈥淲e still have a long way to go to find out ... how we could gather up the financing to do this,鈥� said Ms. Hamdi.

How the money is provided 鈥� be it loans, grants, or other funding schemes 鈥� is also a concern, said Grita Anindarini, a program director at the Indonesian Center for Environmental Law.

鈥淲e just want to make sure that these funds won鈥檛 lead to a debt trap,鈥� said Ms. Anindarini.

Ms. Hamdi raised concerns over how money from transition schemes could be spent. In a recent report, she critiqued 鈥渁 lack of disclosure on the selection criteria鈥� for plants selected for early retirement buyouts by Indonesia鈥檚 state-owned electric company, PLN, including some plants that will be 鈥渂eyond their economic useful life by 2055.鈥� JETP funding could be used to support the buyouts.

鈥淧LN should retire them within the next couple of years and write them off,鈥� Ms. Hamdi wrote in the report.

Another concern raised by activists is that the JETP deal doesn鈥檛 make clear what, if any, restrictions it will put in place regarding Indonesia building new coal plants, or whether Indonesia would be required to decrease coal exports. A 2022 presidential regulation provides an exemption to build previously planned coal plants or those attached to nationally strategic projects.

Coal is a valuable part of Indonesia鈥檚 economy, with the country being the largest exporter by tonnage in the world. Customers include China, India, and Japan. The war in Ukraine has caused a spike in energy costs, with the increased price likely to remain for the next two or three years, said Ms. Hamdi.

鈥淵ou can understand the rationale for them wanting to develop their industries and their natural resources,鈥� said Ms. Elzinga. 鈥淭he responsibility of the development community and those who want to support Indonesia is very much to come up with solutions that allow them to do both.鈥�

In a written statement sent to The Associated Press, Darmawan Prasodjo, the CEO of PLN, wrote that the company has already canceled some coal-fired plants in their near-term business plan and is 鈥渃ommitted to lead the energy transition in Indonesia.鈥�

Muliawan Margadana, vice chairman of the Indonesia Mining Association, and experts raised concerns over the future of communities reliant on the coal industry, which makes up 35% of East Kalimantan鈥檚 GDP and employs nearly 9% of its population.

鈥淢ore than 250,000 people are directly employed by coal mining. If we calculate their families, about 1 million people are impacted,鈥� said Mr. Margadana.

But he said that reskilling workers is possible 鈥� something Hamdi agrees with.

鈥淲hat鈥檚 important, and will be considered as just, is how the transition funding will be allocated to help these impacted workers, whether through upskilling, reskilling, or community development,鈥� said Ms. Hamdi.

Domestic energy policy is also not up to speed with the transition 鈥� especially for solar energy, which is a key source on Indonesia鈥檚 pathway to net zero 鈥� noted Daniel Kurniawan, a researcher who focuses on solar for the Institute for Essential Services Reform.

There is a lack of a solid policy-making environment and political commitment for Indonesia to 鈥渢ransition to clean energy amidst the overcapacity, driven by overreliance on coal power,鈥� he said. 鈥淎lthough that is bound to change with JETP.鈥�

Geography presents another challenge. Indonesia is a large archipelago with significant differences in energy resources, distribution, and population centers, said Ms. Elzinga. For example, Java, the country鈥檚 administrative center, accounts for around 60% of the population and some 75% of electricity consumption, but only a small percent of renewable potential.

While the challenges are varied, they鈥檙e not insurmountable, said Ms. Hamdi. Her organization and others are monitoring developments with Indonesia鈥檚 energy transition.

鈥淲e have to watch as well how this energy transition will create a better impact and a better future for our communities,鈥� said Ms. Hamdi. 鈥淚t has to be for the whole range of citizens.鈥�

This story was reported by The Associated Press. Sibi Arasu reported from Bengaluru, India. AP photojournalist Dita Alangkara contributed from Indonesia.