Financial Supports for Coal and Renewables in Indonesia

The report finds that while coal may appear cheaper on a per-unit basis when considering only generation costs and subsidies, its "true cost" is significantly higher than that of renewable energy once environmental and health externalities are included. In 2015, subsidies to coal were estimated at USD 644 million, nearly five times the USD 133 million provided to renewables. The authors argue that Indonesia's energy policy should shift toward increasing the share of renewable energy and reducing coal to lower the long-term cost to society.

• The "true cost" of coal is considerably higher than that of renewable energy when subsidies and externalities, such as air pollution and greenhouse gas emissions, are included.
• The report identified 15 subsidies for the coal industry, though only seven could be quantified. Estimated subsidies to coal production were USD 946 million (IDR 12.4 trillion) in 2014 and USD 644 million (IDR 8.5 trillion) in 2015.
• Subsidies for coal significantly outweigh those for renewables. Between 2012 and 2015, the export tariff exemption for coal alone totaled USD 719.6 million, which is far more than the cumulative USD 179 million provided to renewables from 2010 to 2015.
• In 2015, renewable energy subsidies totaled USD 132.8 million, with the majority (USD 126.4 million) coming from the feed-in tariff (FiT) system and USD 6.4 million from Pioneer Industry Tax Exemptions.
• The total external cost of coal, comprising air pollution and carbon emissions, is estimated at approximately USD 6 cents per kWh.
• On a per-unit basis in 2015, the subsidy cost for renewable energy (USD 0.0055 per kWh) and coal (USD 0.0049 per kWh) was similar, despite the coal industry receiving far more support in absolute terms.

APA

Attwood, C., Bridle, R., Gass, P., Halimanjaya, A. S., Laan, T., Lontoh, L., Sanchez, L., & Christensen, L. T. (2017). Financial Supports for Coal and Renewables in Indonesia. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf

Chicago

Attwood, Clem, Richard Bridle, Philip Gass, Aidy S. Halimanjaya, Tara Laan, Lucky Lontoh, Lourdes Sanchez, and Lasse Toft Christensen. Financial Supports for Coal and Renewables in Indonesia. International Institute for Sustainable Development, 2017. https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf.

Wikipedia

{{cite report |last1=Attwood |first1=Clem |last2=Bridle |first2=Richard |last3=Gass |first3=Philip |last4=Halimanjaya |first4=Aidy S. |last5=Laan |first5=Tara |last6=Lontoh |first6=Lucky |last7=Sanchez |first7=Lourdes |last8=Christensen |first8=Lasse Toft |title=Financial Supports for Coal and Renewables in Indonesia |publisher=International Institute for Sustainable Development |date=May 2017 |url=https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{attwood2017financial, author = {Attwood, Clem and Bridle, Richard and Gass, Philip and Halimanjaya, Aidy S. and Laan, Tara and Lontoh, Lucky and Sanchez, Lourdes and Christensen, Lasse Toft}, title = {{Financial Supports for Coal and Renewables in Indonesia}}, institution = {International Institute for Sustainable Development}, year = {2017}, month = may, url = {https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }