Japanese utilities partner to decarbonise Indonesia’s power sector

Japanese utility companies have partnered with the Japan International Cooperation Agency (JICA) to develop a roadmap to accelerate the decarbonisation of the power sector in Indonesia.

The Tokyo Electric Power Company Inc (TEPCO), JERA, TEPCO Power Grid, and Tokyo Electric Power Services Company (TEPSCO) have agreed to co-conduct the Data Collection Survey on Power Sector in Indonesia for Decarbonisation.

The four companies have established a joint venture to deliver the project from November 2021 through March 2022. The project includes gathering and analysing data on Singapore’s current energy market trends and future outlook.

JICA wants to help Indonesia to achieve its goal of becoming carbon neutral before 2060 as pledged by the government in July 2021 during the United Nations Framework Convention on Climate Change (UNFCCC). Today Indonesia is the largest energy consumer in the Association of Southeast Asian Nations (ASEAN), accounting for nearly 40% of ASEAN’s total energy use.

The agency will leverage roadmaps developed by the four companies to help Indonesia reduce its reliance on coal-fired energy generation and retire conventional energy generation. The roadmaps are expected to help Indonesia achieve its target of 23% of its total energy produced from renewables by 2025 and to curb the construction of new coal power plants by 2030.

Although electrification has been steadily growing in Indonesia, energy demand is also increasing, risking the country’s transition to smart energy solutions and decarbonisation, according to the statement.

As such, recommendations set to be provided by the four companies are expected to play a critical role in helping Indonesia to reduce its greenhouse gas emissions from power generation whilst ensuring energy security.

The four firms will each propose roadmaps Indonesia can adopt to achieve carbon neutrality.

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TEPCO Power Grid will act as project supervisor and will conduct a study on power development and demand assumptions whilst TEPCO will study energy policies, regulations and financial and economic assumptions for decarbonisation.

TEPCO will be responsible for project administration and operational support.

JERA will act as assistant project supervisor and will conduct studies on low-carbon and decarbonised thermal power solutions.

TEPSCO will study the transmission network and how it can be optimized to transport an increasing amount of renewables.

JICA will leverage the roadmaps developed to assist Indonesia Under the Asia Energy Transition Initiative (“AETI”) announced by the government of Japan in May 2021.

JICA will also work with the four companies to implement the roadmaps they would have developed.

TEPCO Power Grid will provide its experience in building and operating transmission and distribution networks, TEPCO its expertise in institutional and financial aspects, JERA its experience in developing net-zero roadmaps for overseas businesses, and TEPSCO its energy consulting and advanced technical services across Africa and Asia.

The development follows the Indonesian government signing an agreement with the International Renewable Energy Agency (IRENA) during the recent COP26 summit in Glasgow, to leverage the agency’s expertise and network to speed up its energy transition.

Commenting on the agreement, Indonesia’s Energy Minister Mr. Arifin Tasrif, said: “Indonesia has committed to reducing greenhouse gas emissions 29% by 2030 and has set a more ambitious target of net-zero emission by 2060 or sooner with international support.

“However, there is a lot to be done domestically in terms of policy, technology, and financial flows. We need support from other countries and international organisations with expertise like IRENA. We look forward to working closely with IRENA to prepare Indonesia’s energy transition.”