Jakarta. An American government official said Thursday that the promised JETP money worth billions of dollars meant to help Indonesia’s energy transition is already moving.

In 2022, coalitions of affluent countries and banks vowed to help Indonesia wean off coal through a climate financing package known as the Just Energy Transition Partnership (JETP). The promised funding -- which mostly consists of loans -- totaled $20 billion at the time. Half of it will come from public money mobilized by International Partners Group (IPG) -- a US-Japan-led coalition of rich nations. The remaining $10 billion will come from financial institutions that belong to the Glasgow Financial Alliance for Net Zero (Gfanz).

Last year, Indonesia launched a plan that detailed how the country would spend the $20 billion. It was also during that time the IPG decided to increase the funding by another $1.5 billion. According to Alexia Latortue, the assistant secretary at the US Department of Treasury, the funding has witnessed some progress. 

Latortue said $1 billion of the promised public money already got approved, while another $2.4 billion was still in negotiations. About $126 million of the approved projects include the 31-megawatt Phase I Ijen geothermal project run by local firm Medco Cahaya Geothermal in East Java. Providing this geothermal commitment is the government-run US International Development Finance Corporation.

“We are moving towards implementing the ambition to have more energy security as well as affordable and clean energy in Indonesia. … This is linked to having a bright green growth in this country, which will create an estimated of over 300,000 quality jobs, and making sure that the transition is just and to the benefit of all Indonesians,” Latortue said at a press briefing in Jakarta, shortly after a closed-door meeting members of the Indonesian Chamber of Commerce and Industry (Kadin). 

“And so for this, we are very pleased to see financing flow,” Latortue said.

Speaking at the same press conference, Kadin’s deputy chairwoman Shinta Kamdani commented on the JETP funding, particularly on how it can help sunny Indonesia unlock its solar power potential. Kadin data shows that Indonesia boasts 3,686 gigawatts of renewable energy, about 3,295 gigawatts of which come from solar energy. 

Shinta said: “Solar power projects [under the JETP] are still waiting for the government regulations. There are many projects in the pipeline. The money is ready, and the projects are already there. … So in principle, it is just a matter of how the government can take advantage of the already existing funds. And so, the government is aware that there is a need to improve the regulations.”

Indonesia is eyeing to reach net zero emissions by 2060 or sooner. The country today still heavily relies on coal for its power generation.