Jakarta. Energy Minister Bahlil Lahadalia said Thursday that coal-reliant Indonesia is in a dilemma in its energy transition journey, especially following US President Donald Trump’s plan to quit the global climate pact.

During his first term in 2019, Trump already took the US out of the Paris Agreement, an international pledge that aimed to limit long-term global warming to 1.5 degrees Celsius above pre-industrial levels. His successor Joe Biden, however, made Washington rejoin the pact on his first day in office. Not long after his White House return in 2025, Trump inked an executive order on the US withdrawal from the Paris Agreement. The UN recently confirmed the US exit.

Trump’s big climate move caught the attention of Indonesia -- a fellow Paris Agreement signatory that still has coal making up 67 percent of its national power output.

“The Paris Agreement is a must. It urges countries to shift to renewable energy. … But we are in a very big dilemma. Mr. President Prabowo Subianto has instructed me to make progress on the national energy sovereignty. It does not mean that we should replace all our energy sources with renewables,” Bahlil told the 2025 Beritasatu Economic Outlook forum in Jakarta.

“We have Donald Trump who wants to pull out of the Paris Agreement. The US was among the countries that pioneered the climate pact, but now they are pulling out of the deal,” Bahlil said.

According to Bahlil, other countries like India and China are blending their coal and renewable energy use.

The International Energy Agency (IEA) data shows coal represents 46 percent of India’s domestic energy sources with a portion of the supply coming from geothermal, solar, and wind as of 2022. China’s coal power use is higher at 61 percent.

The US withdrawal, coupled with other countries’ blended energy sources, prompted Indonesia to mull decarbonizing its coal-fired plants instead of entirely relying on renewables in the meantime. 

“We are considering making use of carbon capture technology. We are currently calculating the price of coal-fired power generation equipped with carbon capture. So we will be able to use ‘clean coal’,” Bahlil said.

Indonesia will also likely miss its renewable energy capacity target this year. Despite aiming to have 23 percent renewables in its energy mix by 2025, Indonesia’s renewable energy share has only reached around 14 percent.

Washington’s withdrawal raised concerns surrounding the US’ financing for the Just Energy Transition Partnership (JETP) climate package. In late 2022, Indonesia announced that it had secured a climate funding package worth up to $20 billion from global financial institutions and an alliance of rich countries. The US and Japan jointly lead the coalition of advanced economies that are sponsoring Indonesia’s energy transition. The JETP money will primarily go into helping Indonesia wean off coal.

Later that day, Bahlil’s aide Eniya Listiani Dewi alluded that the US exit from the Paris Agreement would have little to no impact on the JETP funding. 

“There are a number of countries that are chipping in the JETP climate package, but the money dedicated for coal-fired power plant retirement actually mostly comes from Japan, not the US,” Eniya told reporters on the sidelines of the forum.

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