Emerging captive coal power: Dark clouds on Indonesia's clean energy horizon

The report highlights a significant increase in Indonesia's captive coal power capacity, which grew from 1.4 GW in 2013 to 10.8 GW in 2023. This expansion is primarily driven by the metal industry, particularly nickel and aluminium smelters, as part of a national strategy to increase the added value of natural resources. The authors argue that the government's current energy transition efforts focus too narrowly on the utility grid, ignoring the substantial emissions from captive plants. They recommend that the USD 20 billion Just Energy Transition Partnership (JETP) funding be used to establish a clear retirement pathway for these industrial coal plants to avoid significant health and economic burdens.

• Captive coal power capacity in Indonesia has expanded rapidly, increasing nearly eightfold from 1.4 GW in 2013 to 10.8 GW in 2023. This growth rate is nearly five times faster than the global average for captive CFPP expansion.
• A substantial portion of Indonesia's current and future coal capacity is dedicated to captive industrial use. Nearly 25% of operating coal capacity is captive, and as of July 2023, 14.4 GW of proposed or under-construction coal capacity is for captive use, representing over half of all proposed additions.
• The metal industry is the primary driver of captive coal power, with 76% (8,214 MW) of operational captive capacity dedicated to metals. Nickel smelters alone account for 67% (7,273 MW) of this capacity. Future plans include 9.8 GW of captive power for nickel and 3.2 GW for aluminium smelters.
• Indonesia's industrial policy, specifically the Rencana Induk Pembangunan Industri Nasional (RIPIN) 2015-2035, encourages the development of coal plants if they increase the 'added value' of natural resources through domestic processing, such as the bans on nickel and bauxite ore exports.
• There is a policy gap regarding the retirement of captive coal plants. While the government has committed to retiring utility CFPPs, it has not set a timely retirement plan for captive plants, and some regulations allow new CFPPs for integrated industries if they meet certain emission reduction and operational deadlines.
• The authors argue that excluding captive CFPPs from the national energy transition plan could result in 27,000 air pollution deaths and an economic burden of IDR 330 trillion (USD 20 billion) due to health impacts.
• The report recommends that the USD 20 billion Just Energy Transition Partnership (JETP) funding be used to target the retirement of captive coal plants and accelerate the transition to renewables in the industrial sector.

APA

Parapat, J., & Hasan, K. (2023). Emerging captive coal power: Dark clouds on Indonesia's clean energy horizon. Global Energy Monitor. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_Indonesia-Captive_2023_11.pdf

Chicago

Parapat, Jobit, and Katherine Hasan. Emerging captive coal power: Dark clouds on Indonesia's clean energy horizon. Global Energy Monitor, 2023. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_Indonesia-Captive_2023_11.pdf.

Wikipedia

{{cite report |last1=Parapat |first1=Jobit |last2=Hasan |first2=Katherine |title=Emerging captive coal power: Dark clouds on Indonesia's clean energy horizon |publisher=Global Energy Monitor |date=20 September 2023 |url=https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_Indonesia-Captive_2023_11.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{parapat2023emerging, author = {Parapat, Jobit and Hasan, Katherine}, title = {{Emerging captive coal power: Dark clouds on Indonesia's clean energy horizon}}, institution = {Global Energy Monitor}, year = {2023}, month = sep, url = {https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_Indonesia-Captive_2023_11.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }