Indonesia signed deals with international lenders and major nations on Tuesday that will bring billions of dollars in funding to help the country increase its use of renewable energy and reduce its reliance on coal.
The $20 billion agreement was announced on the sidelines of the Group of 20 summit in Bali, Indonesia. Called a Just Energy Transition Partnership, or JETP, it is meant to help developing countries reduce their reliance on fossil fuels such as coal and gas that cause carbon emissions that contribute to climate change.
It’s an important step for Indonesia, a major exporter of coal that has abundant potential for developing cleaner energy.
“In today’s world, climate change is a global emergency,” said Luhut Binsar Pandajaitan, Indonesia’s coordinating minister of maritime and investment affairs. “Indonesia has an important role to play in avoiding the worst impacts of climate change on our countries, our people and the environment.”
Participating governments –- the United States, Japan, Canada, Denmark, the European Union, France, Germany, Italy, Norway and the United Kingdom –- are to provide a total of about $10 billion in concessionary lending, grants and equity. Major private global financial institutions that earlier pledged to support climate investment will arrange the rest, U.S. officials said.
As part of the agreement, Indonesia has pledged to ensure emissions from the country’s power sector start falling by 2030. The country has stepped up its goal of making the entire power generation sector emissions-free by 2050.