Energy transition policies risk enabling environmental destruction and deepening social inequities, particularly within the forestry sector.
he development of biomass as part of Indonesia’s energy transition agenda has been promoted as a promising solution to reduce reliance on fossil fuels and lower carbon emissions. However, beneath these claims lies a troubling paradox as the policy has effectively legitimized large-scale deforestation for the wood pellet industry.
Most recently, the Forestry Ministry’s proposal to convert 20 million hectares of forest into land designated for food and energy production has ignited widespread controversy. Instead of advancing sustainability, energy transition policies risk enabling environmental destruction and deepening social inequities, particularly within the forestry sector.
Why does this happen?
A key factor is the laxity in forestry regulations, particularly regarding multi-use forestry licenses and national strategic projects (PSN) introduced under Government Regulation (PP) No. 23/2021 on forestry administration. These policies have played a significant role in accelerating natural forest deforestation and sparking agrarian conflicts across various regions. These licenses, initially framed as a solution for optimizing forest use, exemplify how lenient regulations can blur the boundary between forest conservation and commercialization. They create opportunities for excessive exploitation.
Forestry multi-use licenses authorize concession holders to engage in various activities within forest estates, including timber harvesting, tourism development and energy forest cultivation. While the policy is designed to balance economic value creation with forest conservation, a 2024 study by the Center of Economic and Law Studies (CELIOS) found that some companies have prioritized highly profitable activities, such as monoculture energy forest plantations, at the expense of environmental sustainability.
Oversight of licenses for multiple-use forestry remains weak, creating a critical gap that enables various irregularities to occur. While the regulatory framework, as outlined in the Director General of Sustainable Production Forest Management Regulation No. P.1/2020, is in place, it falls far short of being effective.
Forestry regulations often seem to function as mere administrative formalities, lacking rigorous enforcement on the ground. Companies with permits frequently clear natural forests under the guise of energy crop cultivation or land rehabilitation. Yet, instead of restoring these areas, such activities often worsen ecosystem damage, displace native flora and fauna and diminish the forest’s ability to absorb carbon.
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