Energy transition has become a global issue that pressures countries to promote renewable energy. Indonesia has committed to reducing carbon emissions to curb global temperature rise by raising its Enhanced Nationally Determined Contribution (E-NDC) target to 31.89% by 2030. Previously, Indonesia targeted a 29% carbon emission reduction, equivalent to 835 million tons of CO21. Although Indonesia has an ambitious target, it can still be categorized as “critically insufficient,” according to Climate Action Tracker2 analysis. Indonesia has room for improvement, one of which is reducing the use of coal. In line with this, the government plans to phase out coal by 2050.

On the global side, several countries, such as the European Union, France, Germany, the UK, and the US, also released the JETP (Just Energy Transition Partnership) scheme in conjunction with the G20 Summit 20223. The JETP scheme provides an initial financing commitment of USD 20 billion over three to five years. So far, the Government of Indonesia, through the ETM (Energy Transition Mechanism), plans to use the JETP flow of funds for two things: (i) financing early retirement of steam power plants and (ii) investment in new and renewable energy4. Infrastructure is an essential aspect of supporting the energy transition. However, the energy transition financing scheme has yet to consider the social and economic factors of the coal transition.

The big goal of the energy transition will remain within the social and economic impacts that will arise in the future. Social impacts and environmental risk mitigation are essential parts of the energy transition. The energy transition will majorly impact labor dynamics, social protection, and economic diversification5. While the energy transition has the potential to create new jobs in the renewable energy sector, it also has the potential to cause unemployment if the government does not prepare a coal labor transition mechanism. These impacts are also assumed to drive high economic costs if the government needs to build good planning and mitigation. Thus, it is appropriate for the government to consider justice aspects in the energy transition mechanism. Based on this background, Publish What You Pay (PWYP) Indonesia held a PWYP Knowledge Forum (PKF) entitled “Justice in Energy Transition in Indonesia” on Friday, February 24, 2023.

PKF is a discussion and knowledge-sharing forum organized regularly by the PWYP Indonesia coalition to increase understanding and capacity and develop a public discourse on issues, topics, and policies in the natural resource sector.