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1、ii1Emerging captive coal power:Dark clouds on Indonesias clean energyhorizonMetal needed for the renewable energy transition is processed using coal power,andIndonesia must commit to a new path forward20September2023Authors,ResearcherJobit Parapat,AnalystKatherine HasanEditor,CommunicationsSpecialis
2、tHannah EkbergContributors,Researcher,GlobalEnergyMonitorLucy HummerFloraChampenois,ProjectManager,GlobalCoalPlantTracker,GlobalEnergyMonitorDesignerWendiWuCoverSouthKalimantan,Indonesia.PhotobyDominikVanyionUnsplashAcknowledgementsCREAgratefullyacknowledgesthesupport,feedback,andinsightreceivedfrom
3、FloraChampenois,ProjectManageroftheGlobalCoalPlantTracker,andLucyHummer,Researcher,fromtheGlobalEnergyMonitor(GEM),aswellasRadenRadityaYudhaWiranegara,SeniorAnalystfromtheInstituteforEssentialServicesReform(IESR).Theviewsexpressedinthisreportarethoseoftheauthorsandshouldnotbeattributedtoanyoftheafor
4、ementioned.iiAboutCREAThe Centre for Research on Energy and Clean Air(CREA)is an independent researchorganisation focused on revealing the trends,causes,and health impacts,as well as thesolutions to air pollution.CREA uses scientific data,research,and evidence tosupport theefforts of governments,com
5、panies,and campaigning organisations worldwide in theirefforts to move towards clean energy and clean air,believing that effective research andcommunication are the keys to successful policies,investment decisions,and advocacyefforts.CREA was founded in Helsinki and has staffin several Asian and Eur
6、opeancountries.AboutGEMGlobal Energy Monitor(GEM)developsand sharesinformation on energyprojectsinsupport of the worldwide movement for clean energy.By studying theevolvinginternational energy landscape,and creatingdatabases,reports,and interactivetools thatenhance understanding,GEM seeks to build a
7、nopen guideto theworlds energysystem.For more information,visit www.globalenergymonitor.org.DisclaimerCREA is politically independent.The designationsemployedandthepresentation of thematerial on maps contained in this report do not imply theexpressionof anyopinionwhatsoever concerning the legal stat
8、usofanycountry,territory,city orareaor ofitsauthorities,or concerning the delimitation of itsfrontiers or boundaries.The views and opinions expressed in thispublicationarethose of theauthorsand donotnecessarily reflect the official policy or position,orrepresentthe views or opinions,of theCentre for
9、 Research on Energy and Clean Air(CREA),oritsmembersand/orfunders.CREAassumes no responsibility or liability foranyerrorsoromissions inthe contentof thispublication.iiEmergingcaptive coalpower:Dark clouds onIndonesiascleanenergyhorizonMetal needed for the renewable energy transition is processedusin
10、g coal power,and Indonesia must commit to a new path forwardKeyfindingsNearly 25%of operating coal capacity in Indonesiais for captive use,thatis,generated by power stations that areoperatedand utilisedoff-grid by industrialactors.Despite this significantshare,thegovernmentsefforts to transition awa
11、yfrom coal are currently limited to thepower sector.Operating captive power capacity hasincreasednearlyeightfoldfrom2013to 2023,from 1.4 gigawatts(GW)to 10.8GW.Over half of proposed coal capacity additions(announced,pre-permit,andshelved)as of July 2023 is for captive use.Based on the latestdataset,
12、14.4GWofcaptive coal capacity is proposed or in construction.Indonesia is a leading supplier ofthecritical metalsneededfora renewableenergytransition,but many operating and plannedsmeltersare operatedusingcoalpower.The national industrial development planfor 2015-2035considersmetalprocessing to be a
13、dded value tonaturalresources,anddeveloping coal plantsisallowed when they will increase theadded valueof naturalresources.Smeltersare currently located in 13 provinces.Coal capacity additions have been outpacingrenewablesadditions,despiteIndonesias stated goal of peaking emissionsby2030throughtheac
14、celerationofrenewable energy deployment.Future emissions from captive coal plantsare amajorthreatthatmust beconsidered within the planned useof theUSD 20billionJust EnergyTransitionPartnership(JETP)funding.AsthelaunchoftheJETP investment plan hasbeendelayed,Indonesia and internationalpartnersmustneg
15、otiate commitmentstoclear,focused and ambitious targets.iiiContentsKey findingsiiiContentsivNational overview1Trends and distribution of captive power3Insights on the metal industry7Alignment with climate commitments19Policy recommendations20References21ivNationaloverviewAbout two-thirds of Indonesi
16、as electricity is currently generated from coal-fired powerplants(CFPP)(PLN,2023).Based on Global Energy Monitors(GEM)Global Coal PlantTracker as of July 2023,and supplemental data on CFPP units below 30 megawatt(MW),1the country has 249 units of CFPP in operationwith a totalinstalledcapacity of45,6
17、38MW.About three quarters(76.3%)of the countrys coal power generation is dedicated to theutility grid,for which 45%of the total capacity(20,326 MW,83 units)is owned andoperated by PT Perusahaan Listrik Negara(PLN),a state-owned electricity provider,andthe remaining 32%(14,491 MW,49 units)by Independ
18、ent PowerProducers(IPP).The otherquarter(23.7%)of the total capacity(10,821 MW,117 units)is owned by industrial orcommercial users and operated as off-grid plants for direct on-site industrial use or forother companies to reduce load on the grid(GEM,2023,and supplemental data).Powerstations that are
19、 operated and utilised off-grid by industrial actors are known asor referredto as captive plants.Indonesias coal fleet has a relatively young age at an average of 12 years,with 75%built2a?er 2005(IEA,2020;Cui et al.,2022).Moreover,a totalcapacityof 28,749MWis at variousstages of consideration and de
20、velopment both for the grid and also industrial use:14,499MW(53 units)is under construction;4,750 MW(13 units)is at various active developmentstages;and 9,500 MW(32 units)is shelved,accordingto GEMs latestdata.The majorityof34PLN and IPP plants are located in Java-Bali and Sumatra,while most of thec
21、aptiveplantsare located in Sulawesi and Maluku.The distribution of planned and operating CFPPsacross Indonesia is shown in Figure 1.4Meaningnoprogresshasbeenidentifiedontheproposedprojectsforatleasttwoyears,butnotnecessarilythattheprojectsarenolongerunderdevelopmentorconsideration,orcouldntberevived
22、.3Includesprojectscategorisedasannounced,pre-permit,andpermitted.225.5GWofcoalcapacityis0to10yearsold;11.6GWis10-20yearsold;6.6GWis20-30yearsold;and1.8GWis30-40yearsold.About58%ofallunitsaresubcritical.1https:/globalenergymonitor.org/projects/global-coal-plant-tracker/1Source:GEM,Global Coal Plant T
23、racker July 2023.Note:Currently operating units represented by solid circles,and planned and under construction units by dotted circles;dot size represents capacity.Figure1.DistributionmapofcurrentandfuturePLNandIPP,andcaptiveCFPPsinIndonesiaOverseen by Indonesias Ministry of Energy and Mineral Reso
24、urces(MEMR),grid powerdevelopment over the coming decade has been outlined in Rencana Usaha PenyediaanTenaga Listrik(RUPTL)20212030,PLNs business plan for the next decades electricitydevelopment in Indonesia.PLN,together with IPPs,will realise a total of 40.6 GW ofadditional capacity by 2030,where 5
25、2%comes from renewable energy and 48%comesfrom fossil fuels(MEMR,2021).About 13.8 GW of capacity for utility power generationwould come from coal,over one third of thetotalplanned grid power capacity addition.2TrendsanddistributionofcaptivepowerCaptive power plants,mainly dedicated to fulfilling ind
26、ustrial energy needs,are part of5“national strategic”projects.There is limited information on detailed development plansfor captive power plants because the unitsare independentlyownedand operated.However,based on currently available data,therewill be anadditional 14.4GW ofcapacityin the pipeline fo
27、r captive power,roughlyequivalentto theplannedexpansionbyPLN andIPPs for the national grid.Information presented in this analysis summarises availabledata from GEMs database,compiled from publicly available information on current andforthcoming investments and partner organisations within Indonesias
28、 civil societynetwork.MEMR does not disclose plant-level listingofcaptive power plants.As illustrated in Figure 2,PLN and IPP power capacities have grown significantly over thepast several decades,particularly between 2010 and 2020.The dramatic trend is alsoapparent in captive CFPP expansion,with a
29、nearly eightfold increase in captive powercapacity in the last decade,from 1.4 GW in 2013 to 10.8 GW in 2023.The expansion ofcaptive CFPP capacity in Indonesia in the last decade is nearly five times faster than therest of the world.5Captivecoalpowermentionedinthisreportreferstocoal-firedpowerplants
30、ownedandoperatedbyindustrialandcommercialusers,fordirecton-siteconsumptionofownusewhicharetypicallylinkedtodirectorownuselicence(IzinUsahaPenyediaanTenagaListrikUntukKepentinganSendiri,IUPTLS),orforthedesignatedbusinessareas(WilayahUsaha,WU)ofPrivatePowerUtility(PPU)companiesasdeterminedbytheMinistr
31、yofEnergyandMineralResourcesforsupplyand/ordistributionofelectricpower3Figure2.PLN,IPP,andcaptiveCFPPgrowthovertheyearsAcross the major island groups of Indonesia,Java has the highest CFPP capacity(seeFigure 1).In Java-Bali,the majority of the total operating capacity,27.6 GW or 95.1%,isowned and op
32、erated by PLN and IPPs for the nationalutility grid,and only1.4 GWor 5.2%is for captive power operated off-grid by the private sector.A similar observation appliestoSumatra and Kalimantan,where only 22.4%and 16.8%of shares are attributedto captivepower,respectively.The situation differs widely in th
33、e islands across eastern Indonesia,namely Sulawesi,Maluku,Nusa Tenggara,andPapua,wherethemajority(86.3%)of powergeneration is dedicated to captive power.The sharesareillustratedin Figure3.4Figure3.DistributionofcaptiveCFPPsacrosstheprovincesbystatusIn 2022,the industrial sector was responsible for 4
34、3%of Indonesias total energyconsumption and consumed 87 million tonnes of coal(MEMR,2023).At present,thereare117 units of operating captive CFPPs with a total capacity of 10,821MW.About 76%(8,214MW)of the operational capacity is dedicated to the metal industry.A significant share of67%(7,273 MW)is p
35、owering nickel smelters,with the remaining4%isusedfor aluminiumsmelters,and 5%for iron and steel,copper,and other metal and mining processing.Therest of the capacity,about 24%(2,607 MW),isdedicatedtonon-metal sectors power needs,5which are comprised of pulp and paper,cement,textile,chemical plant,an
36、d otherindustrial sectors.The shares are illustratedin Figure4.Figure4.CapacityshareofcaptiveCFPPsgroupedbystatusandsectorDue to Indonesias abundance of natural resources,namely nickel,aluminium,iron,steel,and copper,the country has sought to build out its capacity to mine,process,and exportthese mi
37、nerals.The total planned capacity of 14.4 GW captive CFPP has the potential toincrease with additional projects in the pipeline.As of July 2023,8 GW ofcapacity isunderconstruction,3.8 GW is at various activedevelopmentstages,and 2.6 GWisshelved.Out ofthe total planned capacity,9.8 GW would be used t
38、o power thenickel smelters,3.2 GWforaluminium smelters,and the remaining1.4 GW forotherindustrial sectors.6InsightsonthemetalindustryAccording to the Ministry of Industry,thebasemetalindustry hasshownstable growthdueto increased production capacity in mining centres and rising commodity prices in th
39、eexport market.The base metal industry contributes over 5%to the Gross DomesticProduct(GDP)of the entire processing industry(Ministryof Industry,2023).Whilethe trendshows steady growth at an average of 8.3%compounded annual growth between 2010and 2020,the highest growth has occurred since 2020.Sharp
40、 growthat14%was firstseenfrom 2020 to 2021,where the GDP reached IDR 137.6 trillion.In 2022,the GDP wasrecorded at over IDR 168.0 trillion,indicating22%growthfrom 2021(BPS,2023).To strengthen the domestic metal industry,Indonesia plans to integrate upstream anddownstream sectors to boost economic gr
41、owth and encourage higher domestic valueadded in exports(Nikel.co.id,2023).This integration is one of the key policies listed inRencana Induk Pembangunan Industri Nasional(RIPIN)2015-2035,the national industrialdevelopment plan stipulated as GovernmentRegulation(Peraturan Pemerintah,PP)No.14Year 201
42、5.The main aim is to increase the added value of natural resources in theupstream sectors of agriculture,minerals,and oil andgas.To realise this goal,the plan specifies national targets in production capacity increases,technology development needs,the industrial energy demand outlook,as well as theg
43、rowth outlook for Java and non-Java Islands.The plan lists specific targets prioritisingdevelopment outside Java to increase the contribution of non-oil and gas sectors from6non-Java islands from 27%in 2013 to 60%in 2035 and to develop up to 36 industrialestates requiring 50,000 hectares of land(Min
44、istryof Industry,2015).As a concrete step,the Government hasbanned theexport of nickelorewith a gradebelow1.7%since 1 January 2020 through the issuance of Ministerial RegulationNo.11 Year20197(MEMR,2019).A restriction on the exportof bauxitewasalso introduced in the same policy,only allowing export
45、of washed bauxite with Al2O3content beyond 42%up to 11 January2020.The issuance of Ministerial Regulation No.17 Year 2020 reinforced a ban on washed8bauxite exports,effective as of 11 June 2023.8ConcerningtheThirdAmendmenttotheRegulationoftheMinisterofEnergyandMineralResourcesNumber25of2018concernin
46、gtheBusinessofMineralandCoalMining7TheSecondAmendmenttotheRegulationoftheMinisterofEnergyandMineralResourcesNo.25Year2018regardingtheBusinessofMineralandCoalMining6Non-oilandgassectorsincludeagriculture,forestry,fisheries,mining,manufacturing,andvariousothercommodity-basedsectors7These moves showcas
47、e Indonesias commitment to advance industrial downstreaming,essentially to accelerate domestic investment and expand production capacity.Thenickelore ban increased nickel exports value by up to 19 times,from only IDR 17 trillion or USD1.1 billion in 2014,increasing to IDR 326 trillion or USD 20.9 bi
48、llion in 2021(Kominfo,2022a).Processing bauxite ore domestically to produce metallurgical grade bauxite andsmelter grade alumina would increase its economic value by 5 and 15 times,respectively(Ministry of Finance,2023).Driven by the recent policies around ore exports,strikinggrowthisapparentin thel
49、astfewyears.As shown in Figure 5,the biggest growth came from nickel exports,growingtenfoldfrom 2017 to 2022,from IDR 8.7 trillion to IDR 88.8 trillion,or USD 0.64 billion to USD 6.18billion.Iron and steel notably has the biggest portion of theentire metal industryexports,valued at IDR 59 trillion o
50、r USD 4.36 billion in 2017,which grew by nearly 7.5 times toIDR439 trillion or USD 30.5 billion in 2022.Figure5.Exportnetvalueofbasemetalindustry between2012to202299BasedontwodigitsHarmonizedSystem(HS-2)groupings,including75Nickelandarticlesthereof,76Aluminiumandarticlesthereof,72Ironandsteel,73Arti
51、clesofironorsteel,74Copperandarticlesthereof,80Tinandarticlesthereof,79Zincandarticlesthereof,78Leadandarticlesthereof,81Other8MEMRs databaseshows that there are 20 units of currently operating metal smelters10across Indonesia,with a total processing capacity of 4.7 million tonnes annually(MEMR,2023
52、a).Metal commodities covered on the database are nickel,aluminium,copper,iron,manganese,zinc,and lead.Operational production capacity for nickel is the highest atover 3 million tonnes per year,more than double the current capacity available foraluminium processing at 1.3 million tonnes per year.Curr
53、ent production capacity forcopper is the third highest at 325 thousand tonnes per year.Iron and manganese followwith current production capacity ranging from 16to 36 thousandtonnesper year.Zinc andlead smelters,however,have not been operatingtodate.Thesharesare shown inFigure 6.The metal smelters ar
54、e located in 13 provinces across Indonesia,spread across Java,Kalimantan,Sulawesi,Maluku,and Nusa Tenggara.Of the total operating productioncapacity,the most(2.1 million tonnes per year,or 44%)is located in Sulawesi;1.3 milliontonnes per year(28%)is in Kalimantan;0.9 million tonnes per year(28%)in M
55、aluku,andthe remaining 3.7 million tonnes per year(8%)in Java.Additionally,thereare still33unitsof currently-under-construction smelters in Indonesia,with an expected total processingcapacity of 18.2 million tonnes per year.Of which,the most(12.7 million tonnes per year,70%)will be located in Kalima
56、ntan;2.7 million tonnesper year(15%)in Maluku;1.8 milliontonnes per year(10%)in Sulawesi;0.7 million tonnes per year(4%)in Java;and theremaining 0.3 million tonnes per year(1%)will be in Nusa Tenggara.10AccessiblethroughESDMOneMap,https:/geoportal.esdm.go.id/,aweb-basedinformationsystemthatdisplaysv
57、ariousthematicmapsofenergyandmineralresourcesbasemetals,83Miscellaneousarticlesofbasemetal.Accessedthroughhttps:/www.bps.go.id/exim/on07-09-202309:25:10WIB.9Figure6.StatusofmetalsmeltersinIndonesiabycommoditytypeNickel is fast becoming a strategic commodity in the global market for a wide range ofen
58、d-use sectors(Republika,2022).Class 1 nickel ore is a raw material for batteries,andClass 2 nickel is generally used for stainless steel products.Both are crucial materials in11the energy transition,creating great economic opportunities for nickel-producingcountries(Ministry of Trade,2023).Indonesia
59、 was the worlds largest producerof nickel in2022,accounting for 39%of global production(Mining Technology,2023).TheInternational Energy Agency(IEA)projects that nickel demand in the global market willgrow by up to 20 times during the period of 2020to 2040(IEA,2021).Most nickel smelters have been bui
60、lt and are being built in the eastern islands ofIndonesia,aside from some capacity in Banten,as summarised in Figure 7.As of 2022,MEMR reports 14 operating nickel smelters,with 3.05 million tonnes total annualproduction capacity,and 16 smelters under construction,with 2.52 million tonnes totalannual
61、 production capacity.Categorising the captive power plant owners by commodity,this study identifies 53operating captive CFPPs with total power generation capacity of 7.28 GW,dedicated topowering the operating smelters.An additional 9.77 GW of captive power is still in thepipeline,with 7.65 GW(28 uni
62、ts)under construction,1.52 GW(4 units)at various earlydevelopment stages,and 0.6 GW(5 units)shelved.These additional capacities are mostlylocated and will be built in Sulawesi and Maluku.The sharesareillustratedin Figure8.11Class1containingaminimumof99.8%nickel,Class2containinglessthan99.8%nickel(Ni
63、ckel28,2023)10Figure7.CapacityofnickelsmeltersinIndonesiaFigure8.CaptiveCFPPsfornickelsectorinIndonesia11Aluminium is now the second most usedmetalin theworld a?eriron.Approximately75%of the aluminium ever produced is stillin use today,as it can be recycledendlessly withoutcompromising any of its un
64、ique properties or quality(AAC,2023).Based on the MEMRsBooklet Tambang Bauksit 2020,Indonesia has bauxite reserves of 1.2 billion tonnes,equivalent to 4%of the worlds bauxite orereservesof 30.39 billiontonnes(MEMR,2020).In 2019,Indonesias bauxite ore production reached 16 million tonnes.Bauxite can
65、berefined to obtain alumina and smelted to make aluminium,where 2-3 tonnes of bauxitewill produce one tonne of alumina.While the national aluminium demand has reached 1million tonnes,current domestic production capacity is at 250 thousand tonnes,which isonly 0.37%of total world aluminium production(
66、Kominfo,2022b).Based on the ESDM One Map,currently operating aluminium smelters are locatedin WestKalimantan.As shown in Figure 9,as of 2022,there were two operating aluminiumsmelters with a total production capacity of 1.3 million tonnes peryear,and nine smeltersunder construction with a total prod
67、uction capacity of 11 million tonnes per year.Linking to the captive power generation data for companies producing aluminium,thereare 10 operating captive CFPPs with a capacity of 0.4 GW powering aluminium smelterslocated in West Kalimantan and Riau.Additional capacity of 3.24 GW is still expected,w
68、ith0.41 GW(2 units)under construction,2.2 GW(3 units)at variousearlydevelopment stages,and 0.6 GW(2 units)shelved.A large share ofadditional captive powercapacity isplannedfor North Kalimantan and Central Sulawesi,asillustratedinFigure10.The linkagebetweenthis upcoming expansion and the additional s
69、melting capacity that would be required forWest Kalimantan is not made clear,leaving room for furtherinvestigation.12Figure9.CapacityofaluminiumsmeltersinIndonesiaFigure10.CaptiveCFPPsforaluminiumsectorinIndonesia13Iron is the most widely used and important of all metals in the world,asit isusedtocr
70、a?different types of steel which are used in a diverse array of applications,such asmanufacturing,civil engineering,and everything in between(Jefferson Labs,2023).Usesof iron and stainless steel in daily life include machinery and tools,kitchen cutlery,cookware,electronics,and hospital equipment.The
71、 Indonesian Iron and Steel IndustryAssociation(IISIA)estimates that Indonesias steel production will reach 15.8 milliontonnes in 2023,an increase of 5.33%compared to thepreviousyear.IISIA alsoestimatesanincrease in domestic consumption of this base metal in 2023,with 6.17%of growthprojected,an incre
72、ase to 17.2 million tonnes(DataIndonesia.id,2023).The currently operating iron smelter is located in West Java with a 3,640 tonne annualproduction capacity,but expansion is underway for North Maluku and South Kalimantanto add 3.9 million tonnes of annual production capacity,as shown in Figure 11.Bas
73、ed onthe available data,there is no clear linkageshowingwhetheradditional captivepower willbe added to power the smelters that are currently in construction.Additional detail onwhether the North Sumatra captive power plant,as shown in Figure 12,can be linked toiron and steel smelting would also be n
74、ecessaryfor improvedclarity.14Figure11.CapacityofironsmelterinIndonesiaFigure12.CaptiveCFPPsforiron&steelsectorinIndonesia15In addition to the base metals,there are other industrial sectorsthatutilise captiveCFPPsfor their own or collective use within industrial parks,or designated areas dedicated f
75、orindustry use.Based on the available data illustrated in Figure 13,there are five industrialprojects with a total power generation capacity of 3.2 GW that can be identified inKalimantan and Java.In Kalimantan,therearefive captiveCFPP unitsthatcouldbe linkedto Tanah Kuning-Mangkupadi International P
76、ort Industrial Zone and Maloy Batuta TransKalimantan Economic Zone.As for Java,there are five unitsthatcould be linkedto KendalIndustrial Park,Java Integrated Industrial Port Estate,and JababekaIndustrial Estate.Figure13.CaptiveCFPPsforotherindustrialsectorsinIndonesia16Tanah Kuning-Mangkupadi Inter
77、national Port Industrial Zone(Kawasan IndustriPelabuhan Internasional(KIPI)Tanah Kuning-Mangkupadi)is one of the nationallystrategic projects that will be built in Bulungan District,North Kalimantan,with hydrogenand ammonia production,an aluminium smelter,and electric vehicle battery factoriesamong
78、the industries expected to operate in this industry zone(Antara,2022).In 2020,atotal capacity of 400 MW CFPP was plannedtobe built in thisKIPIzone(Tribunnews,2020).In early 2023,there was also a plan to build anotherCFPP withthe capacity of1,000MW torun as a transitional fuel while hydropower and so
79、larassets werebeingdeveloped in thearea(Koran Kaltara,2023).But,as of June 2023,it appearedthe plantswereto be shelvedand replaced with 1,100 MW to 2,200 MW CFPP unit(s)dedicated to aluminium smelting(GEM,2023a).Maloy Batuta Trans Kalimantan Economic Zone(KawasanEkonomi Khusus(KEK)MaloyBatuta Trans
80、Kalimantan)was established through PP No.85 Year 2014 with an area of557.34 hectares located in Kaliorang District,East Kutai Regency,East KalimantanProvince.The main industrial activities in this area will be palm oil processing and itsderivative products and the energy industries such as mineral,g
81、as and coal(DewanNasional KEK,2023).In 2012,a two-unit200 MW CFPP mine mouth wasplannedtobe builtto provide the electricity needs of this industrial area,as wellasovercomethe shortageofelectricity supply to the East Kalimantan system(Antara,2012).There has been littlemention of the project since the
82、n,and it is unclear whether it is still active.With nodevelopments in four years,it appears as of May 2016 that the project has been shelved(GEM,2023b).Kendal Industrial Park(Kawasan Industri Kendal,KIP)isthe largestindustrial townshipdevelopment in Central Java with a total developmentsize of 2,200
83、hectares.KIP willbeanoperating ecosystem for many industrial clustersand a self-sustaining economic system.InDecember 2019,KIP was officially designated as a special economic zone regulated byPPNo.85 Year 2019.The main activities in this area will be for food,furniture,fashion,automotive,electronics
84、,logistics,and the packaging industry(KIP,2023).Initially,a 660MW CFPP was planned to be built to power this park.The plants would be located on thewest side of KIP,adjacent to industrial plots(CNN Indonesia,2015).But,in 2017,it wasreported that the power station would be fueled by natural gas and t
85、he planned CFPPappears to have been cancelled(GEM,2023c).In October 2022,PLN announced apartnership with KIP electricity management company to upgrade the existing mediumvoltage network to 150 kV high voltage,to maintain a reliable power supply up to 40,000kVA(PLN,2022).17Java Integrated Industrial
86、Port Estate(JIIPE)is the first integrated area in Indonesia,with a total area of 3,000 hectares consisting of industrial estates,multifunctional publicports,and residential cities.Located in Gresik,East Java province,JIIPE is a pilot area forindustrial development in Indonesia and wasestablishedthro
87、ughPP No.71Year2021withthe main activities being the metal smelter(nickel and steel),electronics,petrochemicaland energy industries,and logistics(Dewan Nasional KEK,2023a).In November 2014,atwo-unit 600 MW CFPP,was announced to be built to provide electricity in this industrialarea(Bareksa,2014).But
88、,an April 2016 presentation to analysts showed that there was achange to the planned capacity to a two-unit330MWCFPP.Per December2018,therewasno additional news about this project and itappearsto havebeen cancelled(GEM,2023d).Jababeka Industrial Estate(Kawasan Industri Jababeka)lies in Kota Jababeka
89、,WestJava,covering an area of approximately 5,600 hectares(Jababeka,2023).The estate isdesignated as an industrial complex for manufacturing and industrial operations,hostingmore than 2,000 companies from 30 countries,including leading international and localcompanies namely Pertamina,Hitachi,Unilev
90、er,and LOral.At the Indonesia Net ZeroSummit 2022,B20 Indonesia 2022 side event,the factory group signed a joint statementand announced its plans to become Southeast Asias first net zero industrial clustertoachieve net zero carbon emissions by 2050 to support Indonesiasnet zero targetsby 2060(Pertam
91、ina,2022).Out of the two companies that manage the electricity supply for thisindustrial park,one that currently operates a two-unit 140 MW CFPP releaseda statementfor decarbonization efforts,namely achieving 21.3 MW peak power from solar roo?opphotovoltaic system and up to 20%share of biomass co-fi
92、ring in the coal-fired boilers(Cikarang Listrindo,2022).18AlignmentwithclimatecommitmentsThe Government of Indonesia has committed to carry out an early retirement of CFPPs.Presidential Regulation No.112 Year 2022 on the Acceleration of the Renewable EnergyDevelopment for the Provision of Electricit
93、y mandatesMEMR to develop aroadmapforthesectoral plan(BPK-JDIH,2022).Despite the commitment to achieve Net Zero Emissions(NZE)by 2060,the Government has not set out a plan to retire captive CFPPs in theindustrial sector in a timely manner and hasnotlaidouta clearpathwayfor aclean energytransition.Th
94、is problematic gap is made obviousby existing policies andregulations,which allowthedevelopment of new CFPPs for integrated industries under certain conditions iftheyaredeveloped to increase the“added value”of natural resources,committed to decreaseemissions by at least 35%within ten yearsof comingo
95、nline,compared to 2021,andtonotoperate beyond 2050(BPK-JDIH,2022).Recentdevelopments alsoindicateongoing reviewby the Financial Services Authority(Otoritas Jasa Keuangan,OJK)for inclusion of CFPPinIndonesias green taxonomy,which may classify certain projects as environmentallysustainable investments
96、 and therefore eligible for greenfinancing(CNBC Indonesia,2023).In essence,the country allows for smelting capacity expansion,along with the necessarycaptive power generation.Although metal commodities such as nickel and aluminiumcontribute to the global clean energy transition,Indonesia will face d
97、ifficulties in meetingthe national climate targets and commitments if the metal industry remains reliant oncaptive CFPPs.19PolicyrecommendationsAddressing coals role in the energy transition cannot be limited to the power sector.Captive CFPPs are a significant threat that must be addressed by the Ju
98、st EnergyTransition Partnership(JETP)requirements and plans.Provided access to USD 20 billionfunding through JETP,Indonesia is able to set a firm and clear pathway to achieve theemissions trajectory.As set out in the JETP agreement,Indonesia will aim to reach thepower sector emissions peak by 2030(i
99、ncluding on-grid and off-grid),not the previousdeadline of 2037,cap carbon dioxide emissions levels at 290 MTCO2e(about one fi?hlower than the previous baseline),achieve 34%renewables share in all power generationby 2030 through the acceleration of clean energy deployment,andreachNZE targetin thepow
100、er sector by 2050.Inclusion of captive CFPP retirement in the national plan is crucial for a meaningfuland just energy transition,since captive power is responsible for one-fi?h of all healthimpacts of CFPPs in Indonesia.Exclusion ofcaptive CFPP retirement fromthe nationalplanwould cause 27,000 air
101、pollution deaths and IDR 330 trillion or USD 20 billion of economicburden from health impacts.Given that the analysis was done based on the 2040 coalphase-out policy which aligns with the 1.5 degrees climate target,delayed captiveretirement implies even higher impacts(Myllyvirta et al.,2023).As a le
102、ading supplier of critical metals andminerals forthe global clean energysupplychain,Indonesias firm and proactive stance is crucial in advancing efforts todecarbonise energy intensive industries.There is urgency to set outa clear pathwayforall captive power facilitiesnot only for future units in the
103、 pipeline,but also for thecurrently operating CFPPs and,most importantly,for those that are in planning and earlyconstruction phases.Intervention for early retirement scheduling and renewablesintegration would not only support the Governments energy transition and climatetargets,but would also stimu
104、late the nationsclean energydevelopment.Given the significant anticipated energy demand to power themetalindustry,thecountryis entering a crucial window to accelerate the transition away from coal and implementtimely solutions to balance the imperative of industrial development and economicgrowth with the NZE targets.20ReferencesAntara.(2012).BakriePowerAkanBangunPLTUMulutTambang.(ReleasedinFebruary2012).https:/