Implementation of carbon trading through the carbon exchange

Katadata.co.id wrote about the implementation of carbon trading through the carbon exchange which is considered to cause additional costs for private electricity producing companies or independent power producers (IPP). Chairman of the Indonesian Independent Power Producer (APLSI) Arthur Simatupang said the additional costs were for purchasing carbon and additional taxation. Therefore, Arthur advised all parties related to Indonesian carbon trading to pay close attention and see the economic impact resulting from the existence of the carbon exchange. Thus, he assesses that in the future the costs that will be incurred for the carbon exchange are predicted to become more expensive or increase. He also asked the government to immediately have clear regulations regarding industrial sectors that will be subject to the obligation to reduce greenhouse gas emissions. Previously, the Executive Director of the Reforminer Institute, Komaidi Notonegoro, said that carbon trading would help Indonesia achieve the net zero emission (NZE) target by 2060. However, he assessed that the electricity sector would feel the impact of carbon trading the most, especially on the Cost of Supply (BPP) of electricity. According to him, although the existence of a carbon exchange is good for the environment and can reduce carbon emissions, the government must also look at the social, economic and purchasing power aspects of the community, including the business continuity of the IPP.

 

CNBCIndonesia.com wrote about the Ministry of Energy and Mineral Resources (ESDM) continues to seek funding to retire coal-fired power plants (CFPPs) early. Even though there is no certainty regarding funding from the Just Energy Transition Partnership (JETP), the government continues to look for other funding. One example comes from funding from the Asian Development Bank (ADB). Secretary General of the Ministry of Energy and Mineral Resources, Dadan Kusdiana, said that the government does not want the CFPP’s early retirement program to actually burden the State Budget. Given the nature of this program, it is designed to accelerate the early termination of CFPP operations in order to reduce carbon emissions.