Indonesia’s JETP Money Jumps to $21.4 Billion Despite US Exit, $3.1 Billion Greenlit
Jakarta. The Just Energy Transition Partnership or JETP climate package for coal-reliant Indonesia has soared to $21.4 billion despite the US pulling out of the mega deal, according to a senior minister.
The sunny Indonesia has gained approval to use about 15 percent of the total funding, some of which would go into solar photovoltaics.
When Indonesia presided over the G20 in 2022, the country secured a $20 billion climate finance package -- the JETP -- from wealthy nations and global finance institutions. There have been some major developments since then. The US, which had been leading the public pledge portion, exited the deal following Donald Trump’s return to the White House. Germany eventually took over Washington’s role to co-lead the rollout with Japan. The commitments have risen to $21.4 billion as donors made additional pledges to help Indonesia switch to renewables.
Chief Economic Affairs Minister Airlangga Hartarto revealed on Friday that Indonesia could now tap into approximately $3.1 billion in JETP money.
“We are currently negotiating to have $5.5 billion [of loans and equity investments] approved,” Airlangga told reporters in Jakarta.
The Saguling floating solar photovoltaics plant in West Java is among the projects that have their JETP funding approved.
A JETP Indonesia report showed that the Saguling project would get $60 million worth of commercial loans from Germany’s DEG, France’s Proparco, and British private lender Standard Chartered. This 60-megawatt plant is scheduled for commercial operation next year.
The Green Energy Corridors Sulawesi project is in the pipeline to receive a German concessional loan. Indonesia’s sole electricity provider PLN is developing this grid infrastructure of transmission lines to be able to transport green power on the island of Sulawesi. The German state-owned bank KfW has greenlit the loans worth 300 million euros (about $349.8 million). It is now waiting for PLN board approval.
“We will accelerate this ‘JETP 2.0’. So these funds can speed up our climate targets as instructed by our president,” Airlangga said.
The $21.4 billion combines money from International Partners Group (IPG), a coalition of developed economies, as well as financial institutions under the Glasgow Financial Alliance for Next Zero (Gfanz).
The IPG includes Canada, Denmark, the European Union, France, Norway, Italy, the UK, Germany, and Japan. IPG’s post-US withdrawal pledges for Indonesia’s coal exit total $11.4 billion. The remaining $10 billion comes from the Gfanz.
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