top of page

Indonesia and Vietnam: Leading the way to sustainable energy

The nations of Indonesia and Vietnam find themselves grappling with the task of aligning their sustainability aspirations with the reality of their existing coal-fired power system approvals. As beneficiaries of the Just Energy Transition Partnership (JETP), a G7-backed investment scheme aimed at fostering sustainable growth, these countries receive substantial financial backing. The International Partners Group, a conglomerate of Western nations and private financial institutions, has pledged $18-20 billion to Indonesia and a potential $14.1 billion to Vietnam in the form of equity investments, grants, and concessionary loans.

Indonesia’s Balancing Act

Indonesia’s draft plan, currently open for public input, outlines an objective to raise renewable energy’s share in power generation to 44% by 2030. Some 400 priority projects have been identified for JETP investment. However, the plan’s exclusion of coal-fired off-grid systems, which form a significant portion of the country’s capacity, has raised eyebrows and concerns.

Vietnam’s Green Commitment

Contrastingly, Vietnam has taken a different route. Its Partnership Resource Mobilization Plan, unveiled at COP28, demonstrates a clear commitment to a clean energy future. The European Union has praised Vietnam’s dedication and pledged its support.

The Financial Support Conundrum

Despite these advancements, there is a degree of disappointment in both nations concerning the nature of the financial support received. The majority of funds are loans at market rates, while grants make up only a small fraction. This state of affairs underscores the intricacies and potential controversies involved in transitioning to greener energy systems, particularly in regions where China has been a significant investor in infrastructure projects.

Regional Sustainability Efforts

It’s worth noting that other Southeast Asian nations are also making strides towards sustainability. Malaysia and Thailand are pioneering initiatives like converting food waste into compost, expanding solar energy, and investigating clean hydrogen and ammonia production. Singapore leads the pack with its comprehensive government sustainability report and ambitious initiatives such as expanding the electrification of public bus fleets and implementing the ’30 by 30′ initiative to reduce import dependence and ensure food security amidst climate change.


Related News

bottom of page