{"id":49421,"date":"2023-11-02T18:21:13","date_gmt":"2023-11-02T18:21:13","guid":{"rendered":"https:\/\/www.climatechangenews.com\/?p=49421"},"modified":"2023-11-03T16:57:31","modified_gmt":"2023-11-03T16:57:31","slug":"indonesia-delays-coal-closure-plans-after-finance-row-with-rich-nations","status":"publish","type":"post","link":"https:\/\/www.climatechangenews.com\/2023\/11\/02\/indonesia-delays-coal-closure-plans-after-finance-row-with-rich-nations\/","title":{"rendered":"Indonesia delays coal closure plans after finance row with rich nations"},"content":{"rendered":"<p><strong>Indonesia has watered down plans to shut coal-fired power plants early after expressing disappointment at wealthy nations&#8217; offers to help them do so.<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">At the G20 summit on the island of Bali last December, Indonesia and a group of rich countries and banks <a href=\"https:\/\/www.climatechangenews.com\/2022\/11\/15\/rich-nations-banks-pledge-20bn-for-indonesias-coal-to-clean-switch\/\" target=\"_blank\" rel=\"noopener\">announced<\/a> a $20 billion deal to move the Southeast Asian nation from coal to clean energy.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But this announcement left a lot of the details vague. Since then, Indonesia has been pushing for the funders to provide grants instead of loans, which add to the country&#8217;s debt burden.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Yesterday, Indonesia <a href=\"https:\/\/jetp-id.org\/storage\/jetp-comprehensive-investment-and-policy-plan-2023-draft-for-public-consultation-en.pdf\" target=\"_blank\" rel=\"noopener\">published its investment plan<\/a> which revealed that some of its climate commitments had been watered down.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The reason is that the funding made available by international partners was not adequate, according to Fabby Tumiwa, director of the Institute for Essential Services Reform (IESR) and part of a working group advising the Indonesian government.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cI am disappointed because we expected the plan could be aligned with Paris Agreement targets\u201d, Tumiwa told Climate Home. \u201cThis pushes the JETP further away from that\u201d.<\/span><\/p>\n<h3>Targets watered down<\/h3>\n<p><span style=\"font-weight: 400;\">A draft plan seen by Climate Home in August said Indonesia would retire a sixth of its coal-fired power plant capacity by 2030.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But that target was dropped from yesterday\u2019s final version. Instead, Indonesia now plans to start shutting down coal plants before their scheduled closure no earlier than 2035.<\/span><\/p>\n<p>Meanwhile, it plans a massive scale-up of renewables and a reduction of the capacity of existing coal plants in order to get to its 2030 emission reduction target.<\/p>\n<p><iframe class=\"flourish-embed-iframe\" style=\"width: 100%; height: 600px;\" title=\"Interactive or visual content\" src=\"https:\/\/flo.uri.sh\/visualisation\/15593924\/embed\" frameborder=\"0\" scrolling=\"no\" sandbox=\"allow-same-origin allow-forms allow-scripts allow-downloads allow-popups allow-popups-to-escape-sandbox allow-top-navigation-by-user-activation\"><\/iframe><\/p>\n<div style=\"width: 100%!; margin-top: 4px!important; text-align: right!important;\"><a class=\"flourish-credit\" style=\"text-decoration: none!important;\" href=\"https:\/\/public.flourish.studio\/visualisation\/15593924\/?utm_source=embed&amp;utm_campaign=visualisation\/15593924\" target=\"_top\" rel=\"noopener\"><img decoding=\"async\" style=\"width: 105px!important; height: 16px!important; border: none!important; margin: 0!important;\" src=\"https:\/\/public.flourish.studio\/resources\/made_with_flourish.svg\" alt=\"Made with Flourish\" \/> <\/a><\/div>\n<p>In September, an Indonesian government official <a href=\"https:\/\/www.reuters.com\/business\/energy\/western-countries-not-ready-finance-early-coal-power-retirement-indonesia-2023-09-25\/\" target=\"_blank\" rel=\"noopener\">told Reuters<\/a>: &#8220;It is very clear that they [Western nations] are not eager to provide financing for early retirement&#8221;.<\/p>\n<p>The government has also dropped a target to peak its power sector&#8217;s emissions at 290 million tonnes of carbon dioxide by 2030.<\/p>\n<h3>Captive plants headache<\/h3>\n<p>While the new target of 250 million tonnes looks more ambitious, Tumiwa said it is less so because it excludes coal power plants known as captive.<\/p>\n<p>These are power plants that do not provide general electricity to the public but power specific industries like Indonesia&#8217;s fast-expanding nickel sector.<\/p>\n<p><span style=\"font-weight: 400;\">The blueprint unveiled this week excludes these so-called captive plants from its calculations altogether, as \u201cmore work is required to develop a viable decarbonization plan\u201d for them, the document says.<\/span><\/p>\n<blockquote><p><a href=\"https:\/\/climatechangenews.com\/2023\/10\/30\/rich-nations-offer-loans-not-grants-for-vietnam-coal-transition\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\"><strong>Rich nations<\/strong> offer loans not grants for Vietnam\u2019s coal transition<\/span><\/a><\/p><\/blockquote>\n<p><span style=\"font-weight: 400;\">This issue, which <\/span><a href=\"https:\/\/www.climatechangenews.com\/2023\/08\/16\/indonesia-jetp-green-plan\/\"><span style=\"font-weight: 400;\">delayed the publication<\/span><\/a><span style=\"font-weight: 400;\"> of the plan in August, has been complicated by the use of wrong assumptions in the modelling for the targets agreed upon last year when the deal was first announced.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThe number of captive plants is way higher than what it previously thought\u201d, said Tumiwa.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The consequence is that reaching the headline emission peaking target promised in the original commitment is \u201cextremely difficult\u201d, as the document now acknowledges. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cIndonesia\u2019s power sector, accounting for the full extent of off-grid captive power, is likely to exceed this target\u201d, it concluded.<\/span><\/p>\n<h3>Loans not grants<\/h3>\n<p>Despite Indonesia&#8217;s complaints, the investment plan reveals that the vast majority of the finance is in the form of loans and grants make up just 2.5% of the money.<\/p>\n<p>About three-fifths of the money are loans on better than commercial terms while the rest is bank guarantees and ordinary loans at commercial interest rates.<\/p>\n<p><iframe class=\"flourish-embed-iframe\" style=\"width: 100%; height: 600px;\" title=\"Interactive or visual content\" src=\"https:\/\/flo.uri.sh\/visualisation\/15594451\/embed\" frameborder=\"0\" scrolling=\"no\" sandbox=\"allow-same-origin allow-forms allow-scripts allow-downloads allow-popups allow-popups-to-escape-sandbox allow-top-navigation-by-user-activation\"><\/iframe><\/p>\n<div style=\"width: 100%!; margin-top: 4px!important; text-align: right!important;\"><a class=\"flourish-credit\" style=\"text-decoration: none!important;\" href=\"https:\/\/public.flourish.studio\/visualisation\/15594451\/?utm_source=embed&amp;utm_campaign=visualisation\/15594451\" target=\"_top\" rel=\"noopener\"><img decoding=\"async\" style=\"width: 105px!important; height: 16px!important; border: none!important; margin: 0!important;\" src=\"https:\/\/public.flourish.studio\/resources\/made_with_flourish.svg\" alt=\"Made with Flourish\" \/> <\/a><\/div>\n<p>The US is the biggest funder but its finance is dominated by commercial loans and a multilateral development bank guarantee.<\/p>\n<p>The European Union and European nations like France, Germany &#8211; as well as Canada &#8211; are providing grants and concessional loans.<\/p>\n<p>The investment plan is subject to public consultation so is not completely final.<\/p>\n","protected":false},"excerpt":{"rendered":"After its pleas for grants not loans fell mostly on deaf ears, Indonesia has watered down its plans to shut coal power plants early","protected":false},"author":98,"featured_media":48746,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1847,6],"tags":[999,4978,4937],"coauthors":[4974],"class_list":["post-49421","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-asia","category-energy","tag-indonesia","tag-jetp","tag-just-energy-transition-partnership","type-news"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Indonesia delays coal closure plans after finance dispute with rich nations<\/title>\n<meta name=\"description\" content=\"After its pleas for grants not loans fell mostly on deaf ears, Indonesia delays its plans to shut coal power plants early\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" 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