This paradigm shift gained significant traction at the Group of 20 Summit on Nov. 15, 2022, in Bali, where Indonesia inked the Just Energy Transition Partnership (JETP) Joint Statement with the International Partners Group (IPG), led by Japan and the United States. This landmark agreement outlines a commitment of US$20 billion in public and private financing, targeting a substantial reduction of 290 million tons of emissions from the power sector and a 34 percent surge in renewable energy deployment by 2030.

Remarkably, JETP sets even more ambitious goals for Indonesia's energy transition than its Enhanced Nationally Determined Contributions.

The Indonesia JETP Secretariat launched the Comprehensive Investment and Policy Plan (CIPP) on Nov. 21, 2023 to actualize these ambitious targets. This comprehensive document delineates a consolidated energy transition pathway for the power sector, addresses financing needs, offers policy reform recommendations, and introduces the pivotal Just Transition Framework.

UNDP was requested by Indonesia JETP Secretariat to lead the JETP Just Transition working group and collaborate with five other international and national agencies. The working group’s initial task was to formulate the Just Transition Framework as a tool for assessing and guiding the energy transition process to ensure its sustainability and fairness.

Understanding the concept of "just" in the context of energy transition involves navigating two crucial perspectives.

First, the term implies a series of substantial changes, bringing forth both risks and opportunities. For instance, the decommissioning of coal-fired power plants may trigger socioeconomic shifts affecting asset owners, workers, supply chains, and the communities they inhabit.

Similarly, environmental alterations accompany new investments in renewable energy projects. Despite the inherent risks, these changes offer opportunities not only for a diversified economy and increased equality, but also for combating climate change, fostering a greener, more resilient future.

Second, the impact of energy transition investments varies among stakeholders due to their existing socioeconomic capacities to address risks and leverage opportunities. Consequently, the outcomes of energy transition may be distributed unevenly, potentially impacting the vulnerable groups disproportionately and leaving them marginalized.

Considering the above, the JETP Just Transition working group arrived at a comprehensive definition of just transition. In essence, it is a condition where the social, economic, and environmental risks and opportunities resulting from energy transition are equitably distributed among and addressed by the stakeholders.

Moreover, it emphasizes the affirmative enablement of vulnerable stakeholders to navigate risks and capitalize on opportunities. This definition goes beyond the concept of merely avoiding harm; it is forward-looking and aspirational to enhance socioeconomic and environmental conditions.

The Just Transition Framework (JT Framework) provides a set of principles and standards that ensures social, economic and environmental risks and opportunities of future investments for energy transition are shared fairly among the stakeholders.

With the principles of equity, placing human rights, gender equality, and accountability at its core, the JT Framework steadfastly upholds the commitment to leave no one behind and to build resilience and sustainability. Its standards are drawn from established criteria evident in the social and environmental safeguards adopted by multinational development banks, United Nations organizations, and financing institutions.

The JT Framework introduces a novel perspective to this, as it incorporates a fresh standard for economic diversification and transformation, crucial for assessing regional economic risks and opportunities.

Beyond theory, the JT Framework provides guidelines for conducting Just Transition assessments, as a way to determine actions needed to mitigate risks and maximize opportunities associated with specific energy transition investments in the future, and to estimate the cost of such actions. These encompass a strategic sequence of steps that leads to recommendations for Just Transition programs and interventions, which are implementable at various levels—project, sub-national, and national.

The implementation of Just Transition programs thrives on collaborative efforts, outlining shared responsibilities among project developers, communities, civil society organizations, national and local governments, and development partners. The JT Framework, therefore, stands as a comprehensive guide, steering the course toward systemic changes for an inclusive and equitable energy transition.

The JETP’s focus on the justness of the energy transition makes it imperative that both Just Transition assessment and subsequent Just Transition programs and interventions are implemented as prerequisites for future investment projects for energy transition, whether such investment projects are for closing down coal-fired power plants, building new renewable energy power plants, or building electricity transmission lines.

These include meaningful stakeholder participation and grievance handling, unfettered access to information, adequate capacity of the implementer, the availability of requisite financing, and vigilant monitoring.

Thus, the Just Transition Framework stands out with three key features. First, it surpasses traditional safeguards by recognizing the nuanced interplay between risks and opportunities in the energy transition. Second, it explicitly prioritizes vulnerable stakeholders, guaranteeing an unwavering commitment to leaving no one behind. Third, through Just Transition program implementation, it actively cultivates an enabling environment, maximizing both socioeconomic and environmental benefits.

With the recent launch of the JETP’s Comprehensive Investment and Policy Plan (CIPP), seizing the momentum is critical to mainstreaming and operationalizing the JT Framework in Indonesia's vision and plans for energy transition, while also recognizing the value and relevance of JT Framework for energy transition process beyond the initial scope of JETP.

Just energy transition is more than an intervention; it's a catalyst seamlessly integrated into our plans to attain the Sustainable Development Goals. We are envisioning a future where our pursuit of a low-carbon economy not only slashes emissions and embraces renewable energy but also propels inclusive development for all.

UNDP eagerly looks forward to collaborating with stakeholders, igniting the Just Transition Framework into action, and steering Indonesia toward a truly just, equitable, and sustainable energy future.

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The writer is resident representative, UNDP Indonesia.