The Indonesia Ministry of SOEs Supports PLN’s Breakthrough to Accelerate the Clean Energy Transition in Indonesia

PT PLN (Persero) today reaffirmed its committed to support the Indonesian government’s program to achieve the Net Zero Emission target by 2060 through various strategies, such as the development of new and renewable energy (RE)-based power plants, dieselization programs, and the retirement of steam power plants (PLTU).

Vice Minister of State-Owned Enterprises (BUMN) Pahala N. Mansury outlined how the Ministry strongly supports the efforts of PLN in achieving net zero emissions by 2060 and supports low-carbon development based on the Paris Agreement goals to reduce greenhouse gas emissions based on the National Determined Contribution (NDC) of up to 29 percent, as it is stated at the COP26 2021 meeting.

“PLN is committed to decarbonization, such as accelerating the stopping of the use of Coal Fired Power Plant (CFPP) assets, and new renewable energy programs by developing eco-friendly power plants to increase the level of NRE in the energy mix,” explained Pahala.

The President Director of PLN Darmawan Prasodjo welcomes the government’s support to make the energy transition successful, especially to follow the NZE 2060 target. Since 2021, PLN has prepared a roadmap which was presented at the COP26 Summit in Glasgow. This means, continued Darmawan, PLN is ready to lead the energy transition in Indonesia.

Darmawan said in the scenario of business as usual (BAU), Indonesia’s carbon emissions are projected to reach more than 4 billion tons of CO2e/year by 2060. There are 2 sectors with a large contribution to Indonesia’s carbon emissions, namely the electricity sector and the transportation sector.

“Without significant efforts, by 2060 the electricity sector will produce CO2e emissions of 920 million tons per year, but the intervention by PLN will prepare Indonesia to be cleaner for future generations,” he said.

To support this plan, PLN has prepared a roadmap for the retirement of steam power plants (PLTU) to achieve Net Zero Emission by 2060. The steps of retiring the coal-fired power plant of 50.1 gigawatts (GW) until 2056 will be carried out gradually, replacing them with RE power plants.

Darmawan stated that the replacement of PLTU and PLTMG with PLT RE Baseload of 1.1 GW will be carried out in 2025. And in 2030, the first phase of PLTU subcritical retirement of 1 GW will be carried out. Then in 2035, the PLTU subcritical phase 2 will retire at 9 GW. Then in 2040, PLN will operate a supercritical PLTU with a CCUS of 10 GW.

In 2045, the Ultra Super Critical PLTU will be operated by the use of CCUS (carbon capture storage) technology of 24 GW. Furthermore, in 2055, the Ultra Supercritical PLTU with the last CCUS of 5 GW will be operated.

Besides reducing the number of PLTUs, PLN is also conducting a de-dieselization program of 5,200 PLTDs in Indonesia. PLN replaces it with an RE generator based on local natural potential. Currently, the PLTD owned by PLN which will be converted to an RE power plant is around 499 MW. It will be carried out in two steps, namely Phase I in 183 locations with a capacity of 212 MW with a hybrid scheme (PLTS+Baterai+PLTD existing). As a second phase, the conversion of PLTD with a capacity of 287 MW to other RE power plants will be carried out, considering local RE sources.

“This is a big change as it converts import-based energy into cheaper domestic-based energy,” he said.

Instead, PLN will also develop an NRE-based power plant of 20.9 GW by 2030. The addition of NRE capacity is a combination of several NRE sources with a composition of 10.3 GW of hydro power (PLTA), and 10.3 GW of solar power (PLTS). 4.7 GW, geothermal power plants (PLTP) of 3.3 GW, and other RE PLTs of 2.5 GW.

PLN also innovates on the biomass co-firing program in PLTU, through the substitution of coal with biomass partially to increase the NRE mix and reducing carbon emissions. “This is a social-based energy ecosystem because the supply of biomass will be run in collaboration of all social elements,” he said. The trial implementation of the co-firing program at PLN’s PLTU starting in 2020 has been successfully carried out at 47 PLTU locations.

Darmawan added that PLN cannot achieve NZE in 2060 alone, it needs collaboration with various institutions and also political support from the government. “It takes a very large amount of capital to reach Net Zero Emission 2060 at least USD 500 billion. Therefore, we need to be supported on access to low-cost green financing, development grants and G to G pattern support,” said Darmawan.

To do so, the Ministry of SOEs is not only encouraging PLN to support the NZE effort, but also all SOEs must contribute to the initiative.

“We have to encourage renewable energy; each state-owned company cannot work separately, but must collaborate to ensure that the 2060 NZE occurs. The energy transition must be carried out based on the transformation desired by Indonesia,” said Erick Thohir, Minister of State-Owned Enterprises (SOEs), during the SOE International Conference in Bali (17/10).