JAKARTA, Sept 20 (Askume) – The Asian Development Bank (ADB) said on Friday it has approved a $500 million policy loan to Indonesia to fund a programme to support its energy transition efforts.
Resource-rich Indonesia aims to achieve net-zero carbon emissions by 2060 and is working to reduce coal use with financial support from the G7 Just Energy Transition Partnership (JETP).
In a statement, the ADB highlighted Indonesia’s reliance on coal and said the plan “focuses on establishing a strong policy and regulatory framework for the clean energy transition, strengthening industrial governance and financial sustainability.”
“Indonesia is at a critical juncture in its energy transformation journey,” said Jiro Tominaga, ADB Indonesia Country Director. He added that the loan supports Jakarta’s efforts to “accelerate the transition to sustainable and clean energy.”
ADB did not immediately respond to a request for comment asking for specific details on how the funds would be used.
The plan includes the development of investment and policy plans supported by the JETP, as well as reform measures to expand renewable energy generation capacity, ADB said. Credit Bank.
Under the JETP plan, Indonesia has pledged to provide US$20 billion in funding to limit carbon emissions in the power industry to 290 tonnes in 2030, but progress in disbursing the funds has been slow.
Asked about the slow implementation of the JETP, UK development minister Anneliese Dodds told Askume this week that the JETP is a long-term partnership that requires significant changes around infrastructure.
“This is not going to happen overnight,” he said. “The UK is making a real effort to update this approach so that we can focus on green growth and economic development together.”
Dodds said Indonesia has the opportunity to become a carbon sink for the region and the UK intends to work with other JETP partners to accelerate efforts such as poverty alleviation and reforestation.
