Revisiting the Narrative of Indonesia’s Energy Transition in the Prabowo-Gibran Era [Op-Ed]

The official announcement of Prabowo Subianto-Gibran Rakabuming Raka as the new President-Vice President of Indonesia for 2024-2029 will determine the future of Indonesia’s energy transition policy. One of the key questions is to what extent is the pair’s mission aligned with national climate mitigation action, and how can the new administration address the energy transition challenges of the next five years?

Referring to CERAH & MARKDATA Big Data Analysis (2023), Prabowo-Gibran had the least track record in responding and giving statements related to climate and energy transition issues both in the news and social media, compared to other presidential-vice-presidential pairs at the time. The vision-mission document also shows relatively less attention to environmental issues than other issues. This initial finding indicates their lack of attention to environmental sustainability issues, particularly energy transition.

Who is Prabowo-Gibran?

As a politician, Prabowo is known as a controversial figure in civil society. His military background in the past is often associated with cases of human rights violations during Indonesia’s reform period. As a businessman, his name has also been mentioned in the Paradise Papers (ICIJ, 2023) for owning companies suspected of tax scandals. In this case, Prabowo is said to have been a director and vice chairman of Nusantara Energy Resources based in Bermuda. Nusantara Energy Resources is now part of the Nusantara Group, which owns 62,753 hectares of mining concessions in East Kalimantan. Based on sources, most of Nusantara Group’s shares are owned by Prabowo.

His running mate, Gibran Rakabuming Raka, is the first son of Joko Widodo, the current President of Indonesia (2014-2024). Gibran is a businessman and politician who became Mayor of Solo, his hometown, in February 2021. Gibran has been controversial since his nomination as Vice President, which is considered a form of father-son nepotism. Despite public criticism, Prabowo-Gibran still passed the General Election Commission (KPU) verification and won the election with a fantastic vote share of 58%, winning 36 out of 38 provinces in Indonesia.

Energy Transition Ahead

Indonesia’s election is over. Challenges await, especially in accelerating the energy transition. Stagnant initiatives, such as the Just Energy Transition Partnership (JETP), require attention from the President, especially in addressing regulatory barriers, implementing financial support for retiring power plants, and developing renewable energy infrastructure in identified projects under the Comprehensive Investment and Policy Plan (CIPP).

The slow progress of the energy transition also underscores the need for policy breakthroughs and cross-government collaboration. Over the past 13 years, or since the launch of the National Action Plan for Reducing Greenhouse Gas Emissions (RAN-GRK), the transition agenda has not yet been satisfied, even regressing, indicated by the increase in power plant capacity and reduction in renewable energy mix targets.

In short, its actions have not reflected the government’s commitment to transition so far. This is evident from Indonesia’s low energy transition index score compared to other Southeast Asian countries and the global average. A report by CELIOS also confirms that almost all provinces in Indonesia, or 32 out of 34 provinces, are not ready for the energy transition due to several factors, including the uneven distribution of supporting facilities, workforce skills and lack of budget posture and government support for the renewable energy sector.

At this point, the Prabowo-Gibran mission is still sceptical. Their current plan can be examined through the energy independence programme stated in the strategic action called “Asta Cita”. They are confident that accelerating the transition can be done by improving incentive schemes to encourage activities to reserve new energy sources and revising regulations that hinder investment in renewable energy. The programme explicitly mentions efforts to build bioethanol development plants and expand fuel-to-gas and electricity conversion for electric vehicles.

Besides, the term often expressed by Prabowo-Gibran, “downstream”, is perhaps the key narrative in understanding the future of energy transition policy in the next government. The term is popular since this ambition was also frequently said by Jokowi in his final years of presidency to justify more exploitation of critical minerals such as nickel for EV industries. 

Therefore, Prabowo-Gibran’s policy in this sector will most likely continue with the current policy. If so, then a radical correction to the energy transition narrative in the Prabowo-Gibran era is needed.

Corrective action needs to be emphasised on the principle of energy transition, which should not only be placed on emission reduction efforts but also to end Indonesia’s dependence on fossil energy that still dominates the national electricity system. Like Prabowo-Gibran’s mission to ensure national energy security, energy diversification through investment in renewable energy is the most rational choice that should be encouraged. Instead of continuing the role of fossil energy with various innovations that have the potential to harm the economy in the long run, Jokowi is now doing so through policies such as CCS/CCUS, co-firing, and biomass for PLTU.

In addition, energy transition policies should stimulate the involvement of many parties to build collaboration, especially between communities, the private sector and local governments. Unfortunately, the current narrative of energy sector development in Indonesia is still confined to a few actors in the central government, as if by doing so, the policy will run effectively, while in practice, it has proven to be inefficient. Today, regional progress is hampered by the lack of fiscal support and infrastructure due to excessive centralisation of authority. Meanwhile, various conflicts of interest at the central level continue to occur, making it difficult for various initiatives to progress.

Therefore, Indonesia’s future governance model needs to put in place an energy transition that strengthens the role of local governments in managing their potential to become more self-reliant. Local governments are now realising the importance of transforming their economies, which are still dependent on the fossil energy sector. For instance, the province of East Kalimantan, which relies almost entirely on coal sales, is preparing to make the transition as demand for coal in the international market falls.

Al Ayubi is a Climate Justice Associate at Yayasan Indonesia CERAH and Agung Budiono is the Executive Director at Yayasan Indonesia CERAH.

About CERAH

Yayasan Indonesia Cerah, also known as CERAH, is an Indonesian non-profit organisation working to advance Indonesia’s energy transition policy agenda. CERAH combines deep energy sector knowledge, cutting-edge communications capacity, and a campaigner’s desire for change.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Energy Tracker Asia.