Indonesia Energy Ministry: This is the Government’s Strategy in the Energy Sector Towards Net Zero Emission

The Ministry of Energy and Mineral Resources remains committed to achieving the Net Zero Emission (NZE) target by 2060 or sooner with support from other countries. Achieving these targets, of course, requires large funds and advanced technology, as well as human resources that can support it.

“The choice of technology is the main consideration to ensure availability, convenience, affordability, sustainability and competitiveness to achieve energy independence, energy security, sustainable development, as well as climate resilience and low carbon,” said Minister of Energy and Mineral Resources Arifin Tasrif at the launch of the HSBC Energy Transition Project in Indonesia. , Tuesday (10/8).

Arifin also expressed the government’s long-term strategy for the energy sector towards carbon neutrality. On the supply side, the strategy adopted is the development of New and Renewable Energy (EBT), including solar photovoltaic, wind, biomass, geothermal, hydro, marine energy, nuclear, hydrogen, and battery energy storage systems.

“Besides that, infrastructure is very important, so interconnection, transmission and implementation of smart gird is absolutely necessary. There are so many things that we have to integrate, including future funding support,” added Arifin.

Meanwhile, from the demand side, the strategies implemented include the implementation of Minimum Energy Performance Standards (SKEM) and electric stoves. For the transportation sector with the application of Battery-Based Electric Motor Vehicles (KBLBB).

“We hope of course that households can use electric stoves to replace LPG which we have imported and also absorb a fairly large subsidy. If we can transfer this subsidy, we can transfer the funds to support national economic growth. others,” said Arifin.

In addition, the industrial sector is carried out by encouraging industrial growth by encouraging industrial growth according to the types of existing industrial processes and energy transitions. Meanwhile, for the commercial sector, through optimizing energy consumption in private and government-owned buildings.

“To achieve these EBT development targets, of course requires regulations that can provide business certainty and security. Therefore, the Government has formulated several strategic policies, ranging from the EBT Bill to Presidential Regulations and ESDM Ministerial Regulations,” added Arifin.

Regarding the NRE infrastructure financing scheme, Arifin said, it was carried out through private investment, Government-Business Entity (PPP) cooperation, state capital participation, private partnership with BUMN/BUMD, and APBN/APBD, as well as other financing facilities, such as Sector Infrastructure Financing. Geothermal (PISP), Geothermal Resources Risk Mitigation (GREM), and SDG Indonesia One.

“The government has also provided fiscal and non-fiscal incentives, such as tax allowances, facilitation of import duties, and tax holidays. We continue to strive to provide new forms of incentives and financial instruments to increase investor interest,” Arifin explained. (DKD)