Indonesia, one of the world’s economies expanding at one of the quickest rates, has committed to utilizing its sustainable transition to create green and inclusive growth.
Recent actions taken by President Joko Widodo in the lead-up to Indonesia’s hosting of the G20 summit that is scheduled in November 2022 underscore the country’s ambition to reduce its emissions.
These actions include releasing a plan to achieve net zero emissions by 2060 or even sooner, as well as endorsing Global Coal to Clean Power Transition Statement at the COP26, and enhancing Indonesia’s Nationally Determined Contribution before COP27. All these steps were taken in preparation for Indonesia’s summit hosting.
The High-level Policy Commission also on Getting Asia to Net Zero commissioned a report titled “Getting Indonesia to Net Zero,” which investigates how Indonesia can accelerate its transition to a resilient economy with net zero emissions while benefiting its people and its place in the world.
The research is based on new modelling that was commissioned from Cambridge Econometrics. The modelling demonstrates the potential and trade-offs associated with several pathways Indonesia can take to fulfil its existing and more ambitious emissions reduction targets.
According to the findings of the report’s analysis, putting into action Indonesia‘s current net zero strategies could increase Indonesia’s mid-term GDP by as much as 5% by the year 2032, generate up to two million new jobs by the year 2039, and improve Indonesia’s trade balance by $48 billion. All of these potential benefits are outlined in the report.
In addition, if Indonesia were to aim for net zero emissions by the year 2050 rather than the year 2060 and prioritize low-cost renewable energy sources such as solar and wind, the country’s net zero investment needs could be reduced by $3.8 trillion, and the country’s carbon emissions could peak as early as 2027. If this second scenario were to play out, the shift to net zero’s negative impact on household expenditure could be reduced by half.
The report also outlines a road map for how Indonesia could realize these as well as other benefits by prioritizing climate policies that simultaneously address challenges, reforming energy market to favour solar and wind, as well as leveraging green industries to advance a just transition.
