Jakarta (VNA) – Indonesia has created a funding platform for its renewable energy projects, including a pioneering programme to retire coal-fired power plants, and appointed state-owned financing firm PT Sarana Multi Infrastruktur (SMI) to manage the funds.  

SMI will be responsible for managing the funding and financing framework, called the energy transition mechanism (ETM), to achieve Indonesia’s nationally determined contribution (NDC) and net-zero emission targets by 2030 and 2060, respectively.

The platform can accommodate a holistic approach needed to implement ETM in Indonesia, said Febrio Nathan Kacaribu, the head of the Finance Ministry's Fiscal Policy Agency (BKF), during the launch of the ETM platform last week.

SMI’s CEO Edwin Syahruzad said the ETM’s main priority is to end the operation of non-renewable power plants or gradually eliminate coal use.

Last year, the Asian Development Bank (ADB) and the Government of Indonesia announced a new partnership for the development of ETM at the 26th UN Climate Change Conference (COP26) in Glasgow, the UK, as part of an effort to retire coal-fired power plants in Indonesia.

As of April 2022, Indonesia’s State Electricity Company (PLN) had been operating coal-fired power plants with combined capacity of 32,924 MW, accounting for 45% of the country’s total installed capacity.

The Indonesian Ministry of Energy and Mineral Resources (EMR) anticipated that Indonesia’s last coal-fired power plan will be decommissioned by 2058 and the country will be likely to achieve carbon neutrality by 2060./.