Indonesia Needs Immediate $1.5B IPG Grants for Coal Phaseout: IESR
Jakarta. The International Partners Group -- a coalition of rich nations -- should provide grants worth about $1.5 billion in the Just Energy Transition Partnership (JETP) climate finance package, according to think tank IESR.
The IPG -- co-led by the US and Japan -- comprises Canada, Denmark, the European Union (EU), France, Germany, Italy, Norway, and the UK.
Last year, the IPG promised to mobilize $10 billion of public money over a period of three to five years as part of the JETP scheme to get Indonesia off coal power. Financial institutions that are part of the Glasgow Financial Alliance for Net Zero (Gfanz) also pledged to chip in $10 billion. This brings the total JETP funding to be worth $20 billion.
However, the Energy Ministry recently revealed that Indonesia would get around $160 million in grants from JETP. This is a ridiculously small amount compared to the entire JETP package. About half of the promised $20 billion is expected to come from commercial loans.
“We cannot take on debt for our energy programs and coal retirement. Even if we have to, it should be concessional finance with an [interest rate] of below 3 percent,” IESR executive director Fabby Tumiwa told reporters in Jakarta on Tuesday.
“I doubt we can expect some grants from Gfanz because they will [most likely provide] commercial finance. The IPG, however, is providing public money. Hopefully, at least 10 percent of what the IPG gives us [under the JETP scheme] will be grants. But ideally, grants should account for 15 percent of what the IPG offers. So that is between $1 billion and $1.5 billion,” Fabby said.
Indonesia is currently drafting a comprehensive investment plan on the JETP program. This document is set for launch in mid-August.
“Indonesia would need to negotiate with the IPG if it wants more grants. The comprehensive investment plan can be the basis for us to negotiate. The document will lay down the components of how many coal-fired power plants we would have to retire, etc.,” Fabby said.
Tags: Keywords:
as a preferred
Related Articles
Germany Open to Back Prabowo’s 100-Gigawatt Solar Dream
Coal-reliant Indonesia aims to install 100 gigawatts of solar power capacity by 2029.
Indonesia’s 100 GW Solar Push Faces Land, Tariff Challenges: IESR
IESR says Indonesia’s 100 GW solar ambition will require faster procurement, clearer tariff rules, and better land readiness.The Latest
Ye Concert, Other Events to Draw 130,000 to GBK, Here’s What to Know
Around 130,000 visitors are expected at Jakarta’s GBK on Saturday as Ye’s concert and several major events take place.
Indonesia Allocates Rp 722 Billion for Year-End Flight Ticket Tax Relief
Indonesia allocates Rp 722 billion to cover domestic flight ticket VAT during the 2026/2027 Christmas and New Year holidays.
Greece Floats Shipbuilding Partnership with Indonesia
Greece says that it possesses “extensive expertise” as it woos Indonesia in shipbuilding partnership.
Indonesian Stocks Rally 4.9%, but Foreign Investors Keep Selling
Indonesia’s JCI rose 4.9% last week, but foreign selling and MSCI downgrade risks continue to cloud the market outlook.
Ye Concert in Jakarta to Deploy 2,000 Security Personnel
More than 2,000 personnel will secure Ye’s Jakarta concert on Saturday, as organizers urge fans to use public transport.Most Popular
