The EU and International Partners Launch a Groundbreaking just Energy Transition Partnership with Indonesia

Today, the President of Indonesia, Mr. Joko Widodo, the President of the European Commission, Ms. Ursula von der Leyen, on behalf of the EU, and the leaders of the International Partners Group (IPG), under the joint leadership of the United States and Japan, including Canada, Denmark, France, Germany, Italy, Norway and the United Kingdom, launched a Just Energy Transition Partnership (JETP) with Indonesia during the Partnership for Global Infrastructure and Investment (PGII) event at the G20 Summit, held on November 15-16, 2022 in Bali.
In a joint statement, Indonesia and international partners announced their commitment to groundbreaking climate goals and related funding to support the Asian country in an ambitious and just energy transition, which aligns with the objectives of the Paris Agreement and contributes to keeping the goal of limiting global warming to 1.5°C.
It includes a faster path to reducing emissions in the electricity sector to net zero by 2050 and a strategy based on expanding renewable energy sources, phasing out coal-fired power generation both on and off-grid, as well as further commitments to regulatory reforms and energy efficiency.
The EU, together with international partners, will support Indonesia in its efforts to develop an investment plan that will put it on the right track to achieve significant new climate goals and policies to reduce greenhouse gas emissions and support affected communities during the process. Implementing specific actions to achieve a just energy transition for workers and communities, especially those most affected by the energy transition away from coal, is an essential aspect of this partnership.
Indonesia, the EU, and partners will work closely over the next six months to develop this specific plan for investments, financing, and technical assistance.
Overall, the aim of this long-term partnership with Indonesia is to mobilize an initial public and private financing of $20 billion (approximately €19.4 billion) for a period of three to five years, using a combination of grants, concessional loans, market-rate loans, guarantees, and private investments. This will pave the way for achieving future ambitious climate and energy goals.
Half of this amount, $10 billion, will be mobilized by IPG members. The EU and member states participating in the IPG intend to mobilize approximately $2.5 billion. Of this amount, the EU will support the partnership through the European Investment Bank (EIB) with $1 billion to support eligible projects that contribute to decarbonizing Indonesia’s electricity system through the development and integration of renewable energy sources. Additionally, the EU will provide €25 million in grants and technical assistance.
Today’s joint energy transition partnership with Indonesia is the second of its kind following the launch of the JETP with South Africa at COP26 in Glasgow. These partnerships serve as a powerful example of action through global cooperation between emerging economies and international partners to jointly address the climate crisis.