Jokowi issued new EBT policy, regulating early retirement of Coal-Fired Power Plant

Wulan, news . 16 Sep 2022

Heaptalk, Jakarta — Demonstrating its commitment to promoting environmentally friendly energy, President Joko ‘Jokowi’ Widodo, issued the latest regulation concerning the acceleration of New and Renewable Energy’s (EBT) development (13/09).

The new regulation that takes effect on 13 September 2022 covered the prohibition of developing a new Coal-Fired Power Plant (PLTU) as well as EBT electricity tariff determination. As cited in detikcom (15/09), Presidential Regulation no. 112 year 2022 Article 3 Paragraph 1 conveyed that the Ministry will compose a roadmap to expedite the termination of PLTU operation contained in the sectoral design document. This measure is performed to promote energy transition in the electricity sector.

Paragraph 2, furthermore, stated that the roadmap referred to in Paragraph 1 is created after carrying out coordination with the Minister who administers the Country’s finance as well as Minister who regulates State Owned Enterprises.

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Under Article 3, the roadmap referred to in Paragraph 1, at the minimum, contains: (a) Emission reduction of greenhouse gases, (b) Strategy to expedite the termination of PLTU operation, and (c) Alignment between various other policies

In addition, Paragraph 4 describes the prohibition of developing new PLTU, except for:

(a) PLTU that has been stipulated in the Electricity Supply Business Plan before the President Regulation is applied, or (b) PLTU who comply with the requirement as follow:

  1. Being integrated with industries that aim to enhance the added value of natural resources or included in the National Strategic Project, which delivers large contributions to job opportunities creation and/or national economic growth.
  2. Committed to reducing at a minimum of 35% greenhouse gases in a period of 10 years since its operation, compared to the 2021 emission average number contributed by PLTU in Indonesia, which is carried out through the development of technology, carbon offset, and/or renewable energy mixture.
  3. Operate no later than 2050

Inside Paragraph 5, PT PLN expedites the termination period of (a) the operation of self-owned-PLTU and/or (b) the Contract for PLTU’s Electricity Power Sales and Purchase Agreement (PJBL) considering to condition of electricity supply and demand.

Responding to this latest policy, Jokowi stated that the measure is conducted to drive the new and renewable energy transition, particularly in Java and Sumatra. PLTU, later, will be replaced with a geothermal power plant and solar panel.  

“This policy will guarantee the investment certainty. We will widely open to the private sector to collaborate and invest in this transition energy,” stated Jokowi in the B20 Indonesia Inception Meeting 2022 (27/01). The President also added that five PLTUs with 5.5 gigawatt capacity are poised to follow this early retirement program.

Responding to this regulation, the Minister of Energy and Mineral Resources, Arifin Tasrif, delivered that PLTU development is no more being an option today, except for PLTU which has been under construction.

“This regulation also opens great opportunities in the development of new and renewable energy,” stated Arifin. In his closing statement, Arifin affirmed that the recent Electricity Supply Business Plan (RUPTL) would be greener. In PLN’s RUPTL 2021-2030, there is an additional power plant with a capacity of 40.6 gigawatts. In this additional power supply allocation, the portion of EBT will be greater than fossil energy, namely 51.6%.