Ministry of Energy: Indonesia Needs Rp 37,500 Trillion to Fund Energy Transition

JAKARTADAILY.ID – The world's desire to achieve ambitious emission reduction targets requires a large funding capability. The cost is not cheap.

Not all countries have the same ability to fulfill their funding needs. Developed countries, developing countries, and undeveloped countries have different capabilities in funding.

"Here we need help and support from financial organizations to create a global balance through mobilizing funding with a simple and more understandable mechanism so that it can be accessed and affordable for all," said Indonesian Minister of Energy and Mineral Resources Arifin Tasrif, quoted from esdm.go.id, Tuesday, January 19, 2023.

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Speaking while attending the 2023 World Economic Forum (WEF) held in Davos, Switzerland, Arifin explained that Indonesia has set out a detailed roadmap that requires $2.5 trillion in investment. (If converted to rupiah, the value is equivalent to around Rp37,500 trillion).

"Can you imagine how much money we need to achieve Net Zero Emission globally? In 2022, in Indonesia, the investment realization was $1.97 billion, while the total investment plan until 2025 was $57.9 billion until 2030 was $125.9 billion, there was an additional investment of $68 billion from 2025," Arifin said.

Arifin added that the Indonesian government has also set a target to limit global temperature rise to below 2 degrees Celsius, as much as possible 1.5 degrees Celsius, compared to pre-industrial levels. This is in accordance with the Paris Agreement.

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"This figure seems small, but it can create massive transformations, such as industrial revolutions and technological innovations that bring momentum to economic growth," Arifin said.

He realized that the ability of each country is different to achieve the set targets, but he emphasized that the Indonesian Government's commitment remains the same. (***)

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