Jakarta, CNBC Indonesia – It is considered that the Indonesian government needs to be careful about accepting sweet promises of US$ 20 billion or Rp. 300 trillion (assuming an exchange rate of Rp. 15,000 per US$) from a number of developed countries for energy transition programs. The reason is, it is feared that the sweet promise of Rp. 300 trillion will actually be more dominated by loans or debt.
This is what happened in South Africa. Apparently, South Africa has also received energy transition funding commitments from a number of developed countries, similar to the Just Energy Transition Partnership (JETP) offered to Indonesia.
As is known, to date JETP funding from developed countries for Indonesia amounting to US$ 20 billion or Rp. 300 trillion (assuming an exchange rate of Rp. 15,000 per US$) has not been realized.
President of the United States Joe Biden made this US$ 20 billion funding commitment for Indonesia at the G20 Summit (Summit) in Bali, Tuesday (15/11/2022). JETP is a funding initiative from a number of developed countries belonging to the G7 led by the United States and Japan so that Indonesia can abandon dirty energy such as coal-fired power plants (PLTU) and promote clean energy.
On the other hand, South Africa received a funding commitment of US$ 8.5 billion or the equivalent of Rp. 128.18 trillion (assuming an exchange rate of Rp. 15,088 per US$).
Energy Policy Associate International Institute for Sustainable Development (IISD) Anissa Suharsono said that energy transition funding offered in South Africa was dominated by funding in the form of constitutional loan or a constitutional loan of 63% of the total funding offered for the energy transition.
“From South Africa it happened grants (grant) just under 4%, constitutional loan that’s 63%,” he explained in a discussion held by the Bright Indonesia Foundation, Jakarta, Monday (21/8/2023).
While the rest, commercial loans amounted to 18% and guarantee by 15%.
“Then commercial loans And guarantee 18% and 15%. Most for South Africa constitutional loans, grants only less of 4%,” he added.
That way, he assessed that the JETP that would be given to Indonesia should have an equal comparison between internal funding and public funding.
“For later in Indonesia, how is his commitment really early between private funding and public funding, it should be 50:50, right? joint statementIt’s like that, we’ll wait for the reality,” he said.
Previously, the Ministry of Energy and Mineral Resources (ESDM) revealed that there were several types of funding offered by the Just Energy Transition Program (JETP) of US$ 20 billion or the equivalent of Rp. 300 trillion (assuming an exchange rate of Rp. 15,000 per US$).
Secretary General of the Ministry of Energy and Mineral Resources Dadan Kusdiana said that later the funding will go to Indonesia in various forms. He said that later the funds will be provided in different forms according to the carbon emission reduction program that has been prepared by Indonesia.
“JETP is a joint program between Indonesia and IPG, yes, those are the G7 developed countries. There is a commitment to provide funding to accelerate the reduction of the Greenhouse Effect. How is the money, is it going to Indonesia? No. The US$20 billion is not going into Indonesia, no no, so the model is not like that,” said Dadan when met at the Ministry of Energy and Mineral Resources Office, Jakarta, Monday (7/3/2023).
Furthermore, he mentioned that there are types of funding by JETP that will enter Indonesia, some of which are with the mechanism of the brand funding component, the technical assistance component or the Technical Assistance component, and the constitutional loan component where the loan is still divided into several other forms.
“The model is that a funding mechanism will be developed later. In JETP there is a brand component, there is a technical assistance component, there is a loan component, there is a constitutional loan component, there is a guarantee in nature, there is a commercial loan in nature. Now this is through the secretariat (JETP) and Together with the IPG, we will process this later, about what form the funding will be for which project,” he added.
That way at this time, continued Dadan, the government is preparing various lists of carbon emission reduction projects that will be proposed for future JETP funding. He said that the list would be completed in August 2023.
“So what the JETP Secretariat is doing now, the government, Indonesia alone, is preparing from a list of investment plans, what is called comprehensive investment plan And policy. This is what we will complete until mid-August, there are other projects there,” he said.
Sweet Promise of IDR 300 Trillion Biden to RI, Realization Still 0!