Indonesia and the Philippines Take Action to Accelerate Clean Energy Transition
Countries in Southeast Asia have historically relied heavily on coal and fossil fuels to meet their growing energy needs. WRI and partners helped decisionmakers in the Philippines and Indonesia set pathways toward a renewable energy future.
Southeast Asia’s energy demand has grown roughly 6% per year since 2000, one of the fastest growth rates in the world. Despite declining renewable energy prices, Southeast Asian countries have largely opted for fossil fuels to meet their growing energy needs. Close to 60% of Indonesia's electricity supply comes from its 29-gigawatt coal fleet. A recent draft of the Philippine Energy Plan still proposed significant portions of coal and oil in its energy mix, targeting 55% by 2040. Shifting Indonesia and the Philippines’ energy systems to a modern, affordable, low-carbon path can help the two countries attract foreign investment, create jobs, address climate change and improve public health in a region that has been hit hard by the pandemic and by poor air quality.
In the Philippines, WRI worked with Allotrope Partners and the U.S. National Renewable Energy Laboratory (NREL) under the Clean Energy Investment Accelerator (CEIA) initiative and led multiple public-private dialogues. These discussions centered around developing policy that addresses the coal pipeline and deploys more renewable energy. The CEIA organized industrial leaders to voice support for the increased use of affordable clean energy; WRI relayed key takeaways from the dialogues to key Filipino government agencies. WRI also authored an op-ed analyzing the draft Philippine Energy Plan, its effects on the share of fossil-fueled power plants for 2030 and its implications for the growth of the renewable energy market. These activities helped the Philippine Department of Energy shift away from its proposed coal pipeline.
Similarly, WRI Indonesia helped Perusahaan Listrik Negara (PLN), Indonesia’s state-owned electricity utility, build the first renewable energy tracking system in the country. Renewable Energy Certificates (REC), are a commonly used method around the world to track clean electricity generation and to allow a market for renewable energy to emerge. Together with Allotrope Partners, WRI prepared a report for PLN that defined and explained RECs, tracking system methodologies and assessed design options. The team organized industrial leaders to provide input on how PLN’s REC program could meet global GHG reporting requirements and renewable energy purchasing commitments.
In the Philippines, the Philippine Department of Energy set a moratorium on new coal plants, effectively cancelling — or at least stalling — 10,700 megawatts of coal power projects in the energy project pipeline in October 2020. The Philippine National Renewable Board (NREB) has also indicated that it will include a target of achieving 35% renewable energy by 2030 in a new draft of the Philippine Energy Plan.
In November 2020, PLN instituted Indonesia’s first REC tracking program, showcasing a national and corporate-driven shift towards renewables. As a result, PLN registered its project under the program, a geothermal power plant located in West Java. This marks the beginning of a new renewable energy market in Indonesia.
Both of these policies are critical first steps in enabling the regional and global transition away from coal and towards clean energy.