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Draft Indonesia Renewables Bill Proposes Coal-Based Fuels as 'New Energy'

Rabu, 08 Juni 2022 / 17:53 WIB
Draft Indonesia Renewables Bill Proposes Coal-Based Fuels as 'New Energy'
ILUSTRASI. coal bed methane

Sumber: Reuters | Editor: Yudho Winarto

KONTAN.CO.ID - JAKARTA. Environmental experts on Wednesday slammed an Indonesian parliamentary proposal for a bill aimed at promoting renewables that prominently features the development of coal-based energy.

The draft bill, a copy of which was obtained by Reuters, proposes classifying coal bed methane, coal liquefaction and coal gasification as sources of "new energy" alongside nuclear and hydrogen power. Parliament is set to vote on it next week before sending it to government for further discussion.

Indonesia has signed up to a global pledge to phase out use of coal, the most polluting fossil fuel, which is seen as key to cutting emissions and keeping warming below 1.5 degrees Celsius. It has also pledged to reach net-zero carbon emissions by 2060.

The Southeast Asian country is the world's biggest thermal coal exporter and the industry is a major source of government revenue. Coal also powers roughly 60% of its electricity output, far greater than the 12% powered by renewables.

The draft bill, which was verified by a member of parliament's energy committee, lists hydro, wind, solar, and geothermal as renewable energy sources, all of which would receive incentives for their development.

It also calls for an increase in mandatory domestic sales for coal to 30%, from 25% currently, and the removal of all diesel power plants by 2024.

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"Any support for "new energy" will only prolong the transition (to cleaner energy)," Mahawira Dillon, a energy policy researcher at clean energy think tank CERAH, told Reuters.

Another energy research group, the Institute for Essential Services Reform, said in a commentary in March the draft bill shows parliament is accommodating the interests of the coal industry "which wants to continue to gain market share when the coal market for electricity generation declines".

CERAH also called for nuclear energy to be removed from the bill due to safety risks and high development costs.

Some lawmakers on the energy committee contacted by Reuters did not respond to requests for comment. They have previously said Indonesia should take advantage of its large coal reserves and consider affordability of energy as it transitions to cleaner energy.

Indonesia's state utility PLN has pledged to retire all coal power plants by 2056, while the government has promised to double the share of renewables in its energy mix to 23% by 2025.

To encourage investment in renewables, lawmakers have proposed compensating the state power company for losses when it provides power from renewable sources.

Te draft bill also contains proposals for fiscal incentives and support in the form of land, infrastructure and government guarantees for the development of both new and renewable energy sources.

Lawmaker Sugeng Suparwoto said on Tuesday that parliament aims to pass the bill into law before this year's G20 summit, which Indonesia will host in November.

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