Jakarta – Publish What You Pay (PWYP) Indonesia hosted another PWYP Knowledge Forum (PKF) discussion. This time, the forum focused on the latest Electricity Supply Business Plan (RUPTL), titled “Reviewing the Commitment to Energy Transition and the Tendency Toward False Solutions through Gas and Coal in RUPTL 2025-2034.” The event was held hybridly in South Jakarta on June 13, 2025.
Kicking off the discussion, Tata Mustasya, Executive Director of Sustain, noted that the RUPTL 2025-2034, approved on May 26, marks a shift from its predecessor. The latest RUPTL leans more toward green energy compared to the previous plan. However, it still heavily relies on fossil fuels despite a significant reduction from 48% in the 2021-2030 RUPTL to 24% over the next decade. “Greener, but not green enough,” he remarked.
The most substantial reduction in fossil fuel reliance is planned for the second five-year period, which is expected to drop to 24%. “The big changes are slated for the second five years,” he added.
This shift poses significant challenges, particularly in the context of complex political dynamics and shifting government leadership. The planned reduction in fossil fuel use in the second period could face significant hurdles due to the five-year political cycle, which may alter energy policy directions, including the RUPTL. “The most significant improvements in reducing fossil fuel use are planned for the second period. The ambition is stored there,” he emphasized.
Contradictions in Gas and Coal Use and Proposed Policy Incentives and Disincentives
Despite the RUPTL’s ambitious push for an energy transition, Tata observed that gas and coal remain significant components of the energy mix, potentially hindering renewable energy transition goals and global emissions targets.
Tata questioned the continued use of gas and coal as baseloads to address the intermittency of renewable energy. Alternatives, such as geothermal or small-scale hydro, could serve as baseloads instead. Regarding gas, he highlighted that in the second RUPTL period (2029-2034), 2.8 GW of gas-powered plants are still planned, despite a reduction from an initial 10-15 GW. Gas is not only uneconomical but also increases import dependency, contradicting the government’s energy self-sufficiency narrative.
For coal, despite discussions of early coal plant retirements, PLN still plans to build new coal-fired power plants in the second five-year period. The costs of retiring existing plants are already substantial, and new construction would add further financial burdens, raising questions about funding for retirements.
To accelerate renewable energy development, Tata proposed several solutions. For instance, attracting Chinese investment in Indonesia’s renewable energy sector and redirecting coal revenue toward renewables could be key. According to Sustain calculations, coal levies could generate significant funding. “The potential from coal levies is enormous. We’ve estimated at least IDR84 trillion per year,” Tata revealed.
To enhance economic viability and financing, Tata suggested disincentivizing coal through measures like increased production levies and a carbon tax. A phased carbon tax could encourage businesses to shift to low-emission energy sources. Additionally, phasing out or reducing the Domestic Market Obligation (DMO) and aligning domestic coal prices with market rates could make renewable energy development more competitive.
Other recommendations include diversifying energy sources toward renewables and providing consistent incentives for the renewable energy sector. Attracting investment in renewables during the first five-year RUPTL period could ensure a functional market by the second period. A successful energy transition also requires government commitment. For example, fossil fuel-based projects, such as coal gasification, could be redirected to renewable energy initiatives, which are fundamentally more sustainable in the long term.
Despite the significant revenue potential from disincentives (IDR120-150 trillion annually), the main challenge lies in resistance from political elites and coal oligarchs. A gradual approach, transparent policymaking, and data-driven advocacy are necessary to overcome these barriers while ensuring a just energy transition that aligns with global trends toward sustainable energy.