Fueling Net-Zero Transition Through Just Transition
The world is in danger, threatened by looming climate crisis. Recent report from World Meteorological Association (WMA) pictured an alarming projection. Four key climate change indicators — greenhouse gas (GHG) concentrations, sea level rise, ocean acidification and ocean heat — set new records. We are achieving another warmest year record since pre-industrial levels. The trend of rising global temperatures leads us to the brink of catastrophe.
Of course, carbon emission takes responsibility on the heat of the planet. It all comes from our business as usual activity. The growing of GHG is in parallel with economic growth. Indonesia crowned as the world’s eight biggest GHG emitter. Although, Indonesia ranked low at 113th on the list of per-capita emission. Such a paradox that indicates the net-zero transition approach requires different paradigm. It should be delivered on the needs of the environment, the people, and the economy.
Indonesia has had the policy commitment on decarbonizing and transitioning by 2060. This respectable initiative presents many challenges, particularly on energy sector by its conundrum. Fossil fuel-based dominate Indonesia’s energy landscape. Coal, oil, and gas accounting for more than 90 percent of total primary energy mix. On the other side, electricity demand will continue to grow as the Indonesia’s economy expands and the country drives toward 100 percent of electrification.
When we dive deeper on the context of coal, besides Indonesia has abundance resources, coal as a fuel power plants generates the revenue for local economies and absorbs the employees. Another critical fact, the mining sector contributes up to 60 percent of Gross Regional Domestic Product (GRDP) in some districts. Often, the mining industry becomes the primary employer in such areas. It means, for realizing more ambitious net-zero transition, the strategic roadmap is strongly needed to provide equitable alternatives without widespread job losses and economic hardship.
Hence, Just Transition becomes promising concept for fueling the net-zero transition. The primary goals of just transition is to achieve the climate target and increase the well-being of the average Indonesian. Fostering transitions workers and industries to build new, local industries with resilient and sustainable value chains. Delivering a just transition will require careful strategic planning, including developing sector-specific road maps for priority sectors to help illuminate the best path forward.
On the spectacles of private and public sectors, they should work following two key elements; decarbonization and mitigation of any socioeconomic implications. Government, as regulator, need to support this journey by providing significant financial, technological and capacity support. Of course, empowering a just transition need a bunch of capital. The investment should aim strategical areas such as job creation, education, re-skilling, social and ecological welfare, small and medium enterprise (SME) to mitigate impacts while building resilience for the future.
Last but not less important, the international community also takes an important role through foreign investment as well as development finance and support. A holistic and investable “just transition” road map to galvanize the investments is needed.
Starting just transition path forward, means to gather all stakeholders for fueling net-zero transition effort and ensuring no one left behind.
