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Airlangga: GCPA can potentially support Indonesia’s energy transition
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T
he Indonesian government, represented by Coordinating Minister for Economic Affairs Airlangga Hartarto, attended the launch of the Global Clean Power Alliance (GCPA) on the sidelines of the G20 Summit in Rio de Janeiro, Brazil on Nov. 19.
The GCPA, initiated by the United Kingdom in an effort to accelerate the energy transition globally, was officially launched by British Prime Minister Keir Starmer.
The initiative aims to address the challenges of clean energy investment in emerging markets and developing economies (EMDEs) with a broader and more comprehensive approach through a systemic framework that involves all stages of development.
The GCPA focuses on building local-national platforms and strengthening the funding architecture for clean energy projects.
The alliance recognizes the important role of the private sector in financing the energy transition with a specific strategy to attract investment through de-risking financial factors and developing bankable projects. To that end, the GCPA is a more proactive approach than initiatives that rely solely on public funding.
Indonesia is currently accelerating its energy-transition efforts, one of which is through optimizing new and renewable energy. The archipelago possesses enormous renewable energy potential, including geothermal (24 gigawatts), hydropower (95 GW), solar power (169 GW) and wind power (68 GW).
By 2040, Indonesia aims to reduce dependence on coal to 33 percent, increase the renewable energy mix to 42 percent and increase renewable energy capacity by 75 GW, all supported by 70,000 kilometers of new transmission networks. To achieve this vision, Indonesia will require an investment of around US$ 235 billion.
To date, 12 countries and regional organizations have joined the GCPA, namely Brazil, Australia, Barbados, Canada, Chile, Colombia, France, Germany, Morocco, Norway, Tanzania and the African Union.
Indonesia is currently active in several international energy-transition cooperation forums, such as the Energy Transition Mechanism, Just Energy Transition Partnership, Asia Zero Emission Community and Joint Crediting Mechanism.
The launch of the GCPA can be an alternative scheme to finance the energy transition program in Indonesia.
This article was published in collaboration with Coordinating Ministry for Economic Affairs Republic of Indonesia
