Jakarta – Aryanto Nugroho, the National Coordinator of Publish What You Pay (PWYP) Indonesia, expressed several criticisms and rejections towards certain articles in Government Regulation (PP) Number 25 of 2024 concerning Amendments to PP Number 96 of 2021 on the Implementation of Mineral and Coal Mining Business. These comments were made during the “Talk Show on Energy” organized by PWYP Indonesia together with Energi Milenial Indonesia Raya (EMIR) in South Jakarta on Saturday (15/06/2024).
Earlier, on May 30, 2024, President Jokowi signed PP Number 25 of 2024, which regulates several changes, including the definition of Work Plan and Budget (RKAB), the extension period of Mining Business Permits (IUP) or Special Mining Business Permits (IUPK) owned by State-Owned Enterprises (BUMN) subsidiaries, criteria for Production Operations activities integrated with Mineral Metal Processing and/or Refining facilities and Coal Development and/or Utilization, improving community welfare through offering Special Mining Business Permit Areas (WIUPK) management priority to business entities owned by religious mass organizations, and criteria for extending IUPK as a Continuation of Contract/Agreement Operations.
One highlighted article is Article 83A, where priority offers Ex PKP2B mining’s land are given to business entities owned by religious mass organizations. According to Aryanto, this article contradicts with higher regulatory, namely Law Number 3 of 2020 concerning Amendments to Law Number 4 of 2009 on Mineral and Coal Mining (Mining Law).
“Article 75 Paragraphs (2) and (3) of the Mining Law states that IUPK is given to BUMN and Regional-Owned Enterprises (BUMD). It also contradicts Article 74 Paragraph (1), which states that the granting of IUPK must consider regional interests. Referring to the Mining Law, WIUPK should first be offered to BUMN/BUMD, then given to private business entities through an auction mechanism. PP Number 25 of 2024 introduces a new entity, namely business entities owned by religious social organizations, which contradicts higher regulations,” Aryanto said.
Aryanto revealed that there is no prohibition for mass organizations, including religious mass organizations, to own business entities. Nor is there a prohibition for business entities owned by religious social organizations to engage in the energy and natural resources (SDA) sector. As long as it does not violate the constitution and regulations, possesses capacity and experience, is oriented towards supporting sustainable development, and has clear mitigation regarding technical risks and WIUPK auction mechanisms, mining technical risks, environmental risks, potential horizontal conflict risks, conflict of interest risks, corruption risks, and others.
“Unfortunately, on the most basic level, PP Number 25 of 2024 violates the Mining Law!” emphasized Aryanto.
PP Number 25 of 2024 Hinder for Energy Transition
Aryanto explained that natural resource governance, including coal, must align with the spirit of energy transition. Coal use should be reduced due to its significant contribution to climate change. “Regarding improving coal mining governance, it must align with climate change missions,” he said.
This regulation facilitates business entities owned by religious mass organizations to manage ex PKP2B, potentially increasing national coal production. As stated in the National Energy General Plan (RUEN), the national coal production target in 2019 was a maximum of 400 million tons. However, in the last three years, coal production has increased and far exceeded the 400 million ton target.
Aryanto argued that during this energy transition period, the government should focus on controlling coal governance to achieve RUEN targets. Therefore, with that awareness, the policies made should support the energy transition. “This policy contradicts and hampers the energy transition in Indonesia,” he stressed.
In addition to offering ex PKP2B mining land to religious mass organization business entities, Aryanto also highlighted the removal of the word “annual” in the coal production Work Plan and Budget (RKAB). “The change from yearly to three-year periods makes supervision difficult,” he explained.
Regarding natural resource governance during the energy transition, Aryanto continued, what should be done is a mining permit moratorium. Not facilitating or giving space for the religious mass organization to mine coal. PWYP Indonesia invites active youth participation in overseeing the energy transition, including responding to policies that potentially hinder the energy transition, such as PP Number 25 of 2024.
“At this stage, we should already be at the level of a mining permit moratorium. Instead of facilitating coal exploitation,” he said.
In line with PWYP Indonesia, Luthfi Yufrizal, Chairman of the Regional Leadership Council (DPD) EMIR Jakarta, believes that the enactment of PP Number 25 of 2024 threatens the course of energy transition in Indonesia. Additionally, it has an increasingly detrimental impact on the environment.
As is known, coal mining activities can potentially damage public facilities. “For instance, in several regions in Sumatra, coal mining activities should have dedicated roads for coal transportation. Companies should have dedicated roads. But some secretly use public roads. This is a problem,” said Luthfi.