What is Indonesia's pathway to limit global warming to 1.5°C?
Current Situation
Emissions profile
Indonesia is witnessing an exponential rise in energy demand. The already high and slowly increasing carbon intensity of its energy demand has led to a doubling of energy related emissions between 1990 and 2019, which will continue to rise until 2030 under current policies.1,2
Since 1993, Indonesia has increased its total emissions over 15% since 2011 (excluding LULUCF). The energy sector remains the largest source of CO₂ emissions, representing one third of emissions, predominantly from electricity supply. This sector, dominated by coal (60%), saw emissions increase almost ten-fold in the past decade. New coal power additions far outpace renewables. Furthermore, the country aims at increasing oil and gas production to reduce its fossil fuels imports (net oil important since 2003).
The second largest sector is transport, responsible for around a quarter of energy-related emissions and also forecast for strong growth.
In the total greenhouse gas balance, energy and LULUCF each contribute around 40% of the total. Deforestation, peat degradation and peat fires have contributed to a three-fold increase in emissions from this sector and Indonesia now leads the world in LULUCF emissions. The peatland areas remain particularly vulnerable under the biofuel mandate and risk of fires will increase with Indonesia 30% goal of palmoil.
In addition to energy and LULUCF, waste and agriculture are responsible for generating a significant amount of greenhouse gases – around 15% each, making up roughly a third of all GHG emissions (including LULUCF). Of these two, the waste sector has seen emissions jump by a factor of 20 in the last three decades, the largest increase in any sector in Indonesia.
Indonesia's current GHG emissions
MtCO₂e/yr
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Graph description
Historical emissions per gas and per sector. Source: 3rd BUR - indonesia. Latest reported data year : 2019
Data References
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Energy system
Indonesia’s economy is fossil fuel intensive; coal, oil and natural gas supply three quarters of primary energy. Indonesia has significant domestic coal resources and was the world’s second largest producer of coal in 2020.3 Together with palm oil, which has historically been a major driver of deforestation, coal is Indonesia’s biggest export product.4 The use of coal (and oil) is also supported domestically through government subsidies and a cap on the price of coal.
The focus on coal as foundation for the country’s growing power system is set to continue: Indonesia operates 33 GW of coal-fired power plants and plans to double this capacity by this decade. Coal has already doubled its share in the power sector between 1990 and 2019, from ~30% to ~60%. Indonesia’s government owned distribution company, Perusahaan Listrik Negara’s (PLN) has committed to become carbon neutral by 2050, and Indonesia’s Ministry of Energy and Mineral Resources intends to retire coal-fired power plants that have been in operation for more than 20 years and stop building new coal-fired plants after 2023.5,6 However, Indonesia has still a 30 GW of coal-fired power pipeline under construction and the government continues to politically support and subsidise the expansion of its coal industry.7
Indonesia’s vast renewable electricity energy potential remains largely untapped. The National Energy Plan emphasises resource diversification targeting an energy mix by 2025 of oil (25%), gas (22%), coal (30%), and new and renewable energy (23%).8 In response to missing its renewable capacity target of over 15 GW by 2019, the government has strengthened its support to renewables, with improvements to feed-in tariffs, net metering rules and by easing the administrative process for rooftop solar installations. However, the effect of these policies remains uncertain as renewables cannot compete with highly subsidised coal.
Use of biomass and its domestic cultivation is a critical component of the nation’s goal to achieve 23% renewables by 2025.9 Indonesia has a target to increase the share of biofuels in all fuels across all sectors by 30% by 2025. Timely achievement of this target is supported through policies and subsidies directed to biofuel producers to ensure 20% blending mandate, a levy on palm oil export.10,11 Given the historical connection between biofuel production from palm oil plantations and deforestation, it is unclear whether this would drive real emission reductions in Indonesia.
In transport sector, the 2017 Electric Vehicles Development Plan foresaw 3 million electric or hybrid two-wheelers and cars on Indonesia’s roads but it is unclear whether existing incentives will achieve these objectives. Indonesia is also strengthening public mass transit systems, particularly via the Jakarta MRT project.12,13
Targets and commitments
Economy-wide targets
Target type
Baseline scenario target
NDC target
Unconditional NDC Target:
- 29% below business as usual (BAU) levels by 2030 (incl. LULUCF).
- BAU by 2030: 2869 MtCO₂e/yr (incl. LULUCF) or ≈2,155 MtCO₂e/yr (excl. LULUCF).
- 118% above 2015 (excl. LULUCF).
Conditional NDC Target:
- Up to 41% below BAU by 2030 (incl. LULUCF).
- ≈99-100% above 2015 levels (excl. LULUCF).
Long-term target
Indonesia has submitted its long-term strategy for potentially achieving net zero emissions by 2060, featuring long-term scenarios that have strong emissions reduction in the forestry, agriculture, and power sectors.
Sectoral targets
Energy
- National Energy Policy (NEP) targets for primary energy shares:
- Emissions in energy sector to decline from 1030 MtCO₂e/yr in 2030 to around 572 MtCO₂e/yr in 2050.16
Power
- Retire coal-fired power plants that have been in operation for more than 20 years and stop building new coal-fired plants after 2023.17
- Carbon neutral electricity generation by 2050.
- Long term strategy – scenario LCCP (2050):18
- Power generation mix: renewables (43%), coal (38%), natural gas (10%) and BECCS (8%).
- Around 76% of coal power plants are equipped with CCS.
- Carbon intensity of power generation to be at 104 gCO₂/kWh.
Transport
- 30% biofuel blending by 2030.19
- Fuel subsidies have been scaled back significantly (down 75%) in 2014/15 from previous year.20
- Long-term strategy target for 2050:
- Fuel mix: biofuels (46%), oil fuels (20%), electricity (30%) and natural gas (4%).21
Buildings
- Target to reduce final energy consumption by 15% compared to BAU by 2025.
- Green building standards for public and commercial buildings (no comparable standards for residential).
Waste
- Commitment to creation of a ‘comprehensive strategy’ to reduce emissions from waste.
Agriculture
- Mandates on ‘sustainable practices’ for state crops and a target for palm plantation development on non-forested land, but expected impact unclear.
- Successful programmes to improve livestock efficiency.
LULUCF
- Various plans to restrict permits and improve their monitoring, reducing deforestation, degradation, and more.
- Target to stop net deforestation by 2025 and reduce emissions from the entire sector by ~800 MtCO₂e with long-term vision to return this sector as an emissions sink.