Implementing a Just Transition in Indonesia: Challenges and Opportunities

The document examines Indonesia's Just Transition (JT) agenda, primarily driven by the Just Energy Transition Partnership (JETP). While a comprehensive framework exists on paper, implementation is hindered by governance restructuring, a narrow focus on the energy sector, inadequate financing for social components, and significant data gaps. The author argues for expanding JT principles across all economic sectors, strengthening subnational capacity, and increasing grant-based financing to ensure an equitable shift to a low-carbon economy.

• Indonesia's Just Transition goals aim to peak power sector emissions by approximately 2030 and reach net zero in the power sector by 2050, with a target of 34% renewable energy generation by 2030 under JETP frameworks.
• The Just Energy Transition Partnership (JETP) aims to mobilize USD 20 billion in financing, but this covers only about one-fifth of the total investment needed for 2030 targets. Furthermore, the social dimension of the JETP is estimated at only USD 0.2 billion, a marginal share of the total commitment.
• Governance of the energy transition has been disrupted by cabinet changes in late 2024, which saw the National Energy Transition Task Force replaced by the Energy Transition and Green Economy Task Force, necessitating budget realignment and knowledge transfer.
• Just Transition principles are currently applied almost exclusively to the energy sector and JETP-supported projects, leaving other sectors like agriculture, transport, industry, and forestry without a dedicated social framework.
• Subnational implementation is weak, as regional development plans (RPJMD) in priority provinces often ignore Just Transition as a priority and are misaligned with Regional Energy Development Plans (RUED).
• The expansion of the nickel supply chain to support the global energy transition risks creating local environmental degradation and social inequality, as smelting often relies on captive coal-fired power plants.
• The withdrawal of the United States from its co-leadership role in the JETP in March 2025 has introduced uncertainties regarding the predictability of large-scale climate finance for Indonesia.

APA

Lestari, S. (2026). Implementing a Just Transition in Indonesia: Challenges and Opportunities. Climate Strategies. https://climatestrategies.org/wp-content/uploads/2026/02/Indonesia-Policy-Brief-230226.pdf

Chicago

Lestari, Sri. Implementing a Just Transition in Indonesia: Challenges and Opportunities. Climate Strategies, 2026. https://climatestrategies.org/wp-content/uploads/2026/02/Indonesia-Policy-Brief-230226.pdf.

Wikipedia

{{cite report |last1=Lestari |first1=Sri |title=Implementing a Just Transition in Indonesia: Challenges and Opportunities |publisher=Climate Strategies |date=2026 |url=https://climatestrategies.org/wp-content/uploads/2026/02/Indonesia-Policy-Brief-230226.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{lestari2026implementing, author = {Lestari, Sri}, title = {{Implementing a Just Transition in Indonesia: Challenges and Opportunities}}, institution = {Climate Strategies}, year = {2026}, url = {https://climatestrategies.org/wp-content/uploads/2026/02/Indonesia-Policy-Brief-230226.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }