Guest essay by Vijay Jayaraj
Over the past few decades, Indonesia, an archipelagic nation made up of over 17,000 islands, has seen amazing economic progress. The strategic utilization of fossil fuels is a key factor at the center of this growth.
Indonesia is a significant user of coal as well as the world’s third-largest producer of the mineral. But just like other countries, it faces immense pressure from entities like the United Nations and anti-fossil fuel leaders in the West to reduce the carbon dioxide emissions of industrial activity.
Rich countries led by the U.S. and Japan offered Indonesia a $20 billion package in 2022 to persuade the coal-dependent nation to transition off fossil fuels. In November 2022, the country’s leadership signed the agreement known as the Just Energy Transition Partnership, which was expected to formally ratify the nation’s move away from coal.
However, almost a year later, the island nation appears to be going the opposite direction as it embraces fossil fuels for energy security. In 2022, Indonesia used more coal than ever and is looking to produce even more this year.
Indonesia’s coal consumption will rise steadily until 2029 due to the construction of new coal-fired power plants. As per Global Energy Monitor, nearly 19 gigawatts of coal power were under construction at the end of 2022. If the status quo prevails, the country is expected to retain its ranking as the sixth largest emitter of CO2 in the world.
Coal, Nickel, and Asian Energy Security
A plentiful supply of coal, oil and natural gas has had a significant impact on Indonesia’s economic development and is now crucial for boosting the economy and lowering poverty.
For this reason, the country continues to increase the installed capacity of fossil fuel-powered technologies. Since 2015, the highest share of increase in electrical generation capacity has been in fossil fuels, not renewables. In 2022, almost 90 percent of the country’s primary energy came from coal, oil and gas.
Among these, oil and coal provide the majority of the county’s primary energy, with the latter’s contribution being 45 percent. Not only is Indonesia’s coal output essential to the country’s energy security but it is also for Asia’s. The nation is on course to produce in 2023 695 million tons, of which 518 million tons will be exported. Some of the largest buyers of Indonesian coal are China, India, Japan, the Philippines and South Korea.
China and India, two of the world’s biggest economies that mostly rely on coal-fired power plants, benefit the most from Indonesia’s exports of coal. With its share increasing to two-thirds in 2022, Indonesia solidified its position as India’s top foreign supplier of thermal coal. For the foreseeable future, Indonesia intends to keep mining its reserves, as neither China nor India are exhibiting signs of reducing their reliance on coal.
It’s also vital to remember that Indonesia is the number one producer of nickel, an essential part of batteries that power EVs and energy storage systems globally. In 2022, half of the world’s nickel production came from Indonesia.
The production of nickel in Indonesia is largely dependent on smelters that use coal energy, which makes the nation even more dependent on the fuel. The adoption of EVs and batteries in Europe and North America suggest that the demand for coal-enabled nickel production will continue in Indonesia.
Indonesia’s sizable export income has been made possible by the global need for coal and nickel. This wealth has been essential for funding development initiatives, maintaining Indonesia’s trade balance and adding to its foreign exchange reserves.
There is no way Indonesia will choose to kill a booming economy for a $20 billion handout to fund a so-called energy transition.
This commentary was first published at Real Clear Energy, October 30, 2023, and can be accessed here.
Vijay Jayaraj is a Research Associate at the CO2 Coalition, Arlington, Virginia. He holds a master’s degree in environmental sciences from the University of East Anglia, UK.
But those people should stay living in thatched huts, and just live The Simple Life!
Like China and India with xl populations, Indonesia has a significant middle class population of ~ 52 million people.
And expanding exponentially.
If the UN and other WEF-controlled agencies think that these aspirational populations are going to forsake their goals of affluence any time soon they have shit for brains.
(But we already knew that 🙁 )
If anything benefits people, especially non European people, the Green Blob will oppose it.
Seems Indos lucked out with lefty neo-baloneyalism and only black livelihoods matter.
Sounds kind of nice at first blush. Can I have a smart phone to order out?
So Indonesia has recognized the reality staring them in the face and acted accordingly. Meanwhile, countries that think of themselves as an advanced culture continue down the path to certain dysfunction and degradation. What’s not to like? The fact that China is orchestrating this is what’s not to like. The Third Obama Administration needs to have a major investigation, starting with follow the money.
Clearly, the sacrifices of the western world count for the square root of naff all
Article tip – climate change – The Climate is Indeed Changing – Grab a Warm Jacket – American Thinker
Besides all that, Indonesia is a sea of motorbikes.
Because of a warm climate and relatively poor people.
But they are awesome for getting through traffic!
One can load up his whole family on one – seen it with my own eyes! Wouldn’t recommend it though.
Nicest people on the planet (my wife is one 💖) – stranger let me try his beautiful bright red scooter which I proceed to fall off and scratch a bit and yet he was so nice and didn’t freak out me.
Reuters has a non-paywall similar article:
https://www.reuters.com/sustainability/climate-energy/indonesia-publishes-energy-transition-plan-g7-funding-2023-11-01/
It mentions that the 20$ billion bribe didn’t cover power plants that aren’t on the grid, like the ones needed to get all that nickel needed for the green idiocy of the West.
“Decarbonization”? “Renewables” ?
PV Solar, Wind, Battery, and Transmission systems are not shown to be carbon negative, or carbon neutral, to use the term meaning net CO2 production negative or neutral.
I’d really like to see a demonstration project to show otherwise.
For instance, aluminum and concrete are major energy consumers in the production of PV Solar and Wind Turbines. Show me a SINGLE instance of an aluminum smelter or concrete plant powered exclusively by PV/Wind/Battery. Anywhere . in . the . world.
I’ll wait….
The whole green plan started with vision to de-industrialize the world to save it from pollution in general before CO2 was the fad, so the plan is working perfectly. Wind turbines, solar panels and greenhouse gases, but especially the weather are just the boogeymen needed to scare people into line.
I hope they understand they are doing this for the right technical reasons. IE that man is not and cannot affect the climate. Atmospheric carbon dioxide is not and cannot affect the climate. Most of the changes are due to the activity of the sun over which we have no control.
Keep burning coal, Indonesia. It will accelerate your transition to prosperity, security, and an economy that can afford to explore future energy options that are sustainable in the long term like nuclear power. And all that wonderful CO2 you release will enhance agricultural production and maybe, just maybe, slow Earth’s almost inevitable transition into the next devastating glacial period.
https://thorconpower.com Lars has a job in Indonesia.
It seems that the US and Japan signers of the Just Energy Transition Partnership did not notice that the Indonesian signers had their fingers crossed. To bad.
China, India, and Indonesia are 1,2,3 coal producers. US is 4. Australia is 5, but much of its output is exported to China and India. So no uS or EU exhortations are going to change anything meaningfully.
Thanks, I’d assumed an incorrect answer to that question.
Yep. The IEA in its coal market update (July 2023) said the share of China, India and the ASEAN region is expected to reach 76% of the world’s coal use by 2024. US and Europe in contrast only 8%.
“There is no way Indonesia will choose to kill a booming economy for a $20 billion handout to fund a so-called energy transition.”
I couldn’t read the link as I didn’t care to allow cookies. I don’t imagine that 20 B would come without strings attached. And they wouldn’t just hand them 20 B.
Does Indonesia (pop 270M) get to make laws about how Indonesia makes electricity, or does some person holding a big check get to decide? The decider could move 10,000 mies away in less than q day if the check cashes.
They didn’t. The $20 Bn ‘package’ was partly in loan guarantees from the World Bank, allowing them preferential loan agreements of several billion, the rest was in promises of private investment of over $10 Bn, as long as they can persuade private investors to invest in Indonesia.
Indonesia made an empty gesture in return for empty promises; it’s all smoke and mirrors, photo opportunities for the COPfest and entertainment for the climate enthusiasts.
Indonesia did the right thing… promise anything, take the money, and run all the way to the bank.
The $20B is about $75 per Indonesian – about 1% annual income. I would not trade anything important to my future for 1% annual income, plus I’d not assume I got any of the benefit. The costs… yeah I’d expect to experience that.
Right on – and they aren’t stupid – that’s why the decarb agreement didn’t cover the coal power plants used by industry like nickel mining and smelting. They can do the math, and switching to unicorn tech would easily cost them more than $20B in extra electricity costs.
More good news. It is especially rich that Japan along with the US offered Indonesia $20 billion to go green yet Japan is an importer of Indonesian coal. You can’t make stuff like this up.
My Australian relatives tell me Australia is stopping coal generation but mining all the coal they can to sell to China. Makes sense, no?
It’s an emotional lefty thing which you’ll struggle to comprehend unless you’re into ‘the universal struggle’. You’ve got half a brain and you’re right out of context with it.
Indonesia First? But that’s racist, innit?
Of course. And so is: MIGA. Heh.
Well done, Indonesia
Ignore those ignorant Greenie activists!
There is no way Indonesia will choose to kill a booming economy for a $20 billion handout to fund a so-called energy transition.
Awwww cmon we’ve got some cheap turbines to move and helicopter money makes the world go around-
Another blade break hits GE wind turbine in Germany | Recharge (rechargenews.com)
It’s good that nations are beginning to ignore the kooks from Western metropolitan centres, who have been styling themselves as the world’s saviours.
Can we have a subcategory of WUWT for fossil fuel investors.
Good idea. My broker has just told me tyhat they will still allow me to invest in steel makers but not in outfits where coal is the main business.
I’m thinking of moving.
that not tyhat
Best energy policy/transition. Use all the coal. Then transition to natural gas and use it all. Then transition to nuclear. Of course oil and hydro all during all of these times. Pump the oil out of Alaska. All of it. Pump the oil of the coast of California. All of it. Then maybe transition to solar or something else that is discovered or whatever is least expensive in the market. Scrap all wind.
Don’t forget the oil sands – Alberta could fuel the world – if we didn’t have a communist puppet running the country.
Using all the coal will take hundreds of years, JD.
The Russians also have huge coal reserves. That they are not amongst the top coal producers listed by Rud Istvan above is probably because they figure they can make much more profit more easily from their large oil and gas reserves.
It is a simple decision for Indonesia (as indeed it is for all developing nations around the world);
Energy is essential for growth, so why jeopardise it to appease the Western nations and their renewable energy ideology.They can clearly see the self inflicted damage the West is bringing upon itself.
They only have to look at Australia, to see how dysfunctional our energy system is becoming with excessive renewables and no or minimal investment in our critical coal generation.
It would be laughable if it wasn’t so dangerous an issue, we are literally blowing up our economy
over a fourth-rate issue. No wonder other regional countries like Indonesia don’t take us seriously
any more!
Given that Indonesia is the 4th largest nation by population – being the 6th largest emitter is not bad at all.
I wonder what happened to the partnership between Indonesia and Thorcon? Maybe partnership is the wrong word, but I thought Thorcom had agreed to produce a proof of concept shipyard-build nuclear barge using molten salt reactors.