financial-supports-coal-renewables-indonesia-executive-summary-en-7ef72b832b9cf7d4.pdf

This report analyzes the 'true cost' of electricity generation in Indonesia, finding that coal is significantly more expensive than renewable energy when subsidies and externalities (air pollution and CO2 emissions) are included. While coal subsidies were estimated at USD 644.8 million in 2015 (likely an underestimate), renewable subsidies totaled USD 132.8 million. Despite a projected slight decline in coal's share of the primary energy mix by 2050, total consumption growth implies a large expansion in coal production, including a near-term plan for 20 GW of new coal capacity.

• The 'true cost' of coal electricity generation is significantly higher than that of renewable energy when subsidies and negative externalities, such as air pollution and greenhouse gas emissions, are included in the calculation.
• The report identified 15 subsidies for the coal industry in Indonesia, seven of which were quantifiable. Estimated subsidies to coal production were IDR 12.4 trillion (USD 946 million) in 2014 and IDR 8.5 trillion (USD 644 million) in 2015. These figures are likely underestimates due to data limitations.
• Subsidies for coal are substantially larger in absolute terms than those for renewables. Between 2012 and 2015, the export tariff exemption for coal alone totaled USD 719.6 million, which far exceeds the cumulative USD 179 million provided to renewables from 2010 to 2015.
• In 2015, renewable energy subsidies totaled USD 132.8 million, consisting of USD 126.4 million through feed-in tariffs (FiTs) and USD 6.4 million from Pioneer Industry Tax Exemptions. Other supports, such as the DKE fund and Geothermal Fund, were not quantified.
• While coal subsidies are nearly five times greater than renewable subsidies in absolute terms, the per-unit subsidy cost in 2015 was similar: USD 0.0049 per kWh for coal and USD 0.0055 per kWh for renewable energy.
• The total external cost of air pollution and carbon emissions for coal-generated electricity is estimated at approximately USD 6 cents per kWh.
• Coal's role in Indonesia's primary energy mix increased from 17 per cent in 2004 to 31 per cent in 2014. Government projections estimate coal will account for 30 per cent of primary energy demand in 2025 and 25 per cent in 2050.
• The Indonesian government planned a rapid expansion of power production by 35 gigawatts (GW), with over 20 GW intended to come from coal.

APA

International Institute for Sustainable Development (n.d.). financial-supports-coal-renewables-indonesia-executive-summary-en-7ef72b832b9cf7d4.pdf. https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf

Chicago

International Institute for Sustainable Development. financial-supports-coal-renewables-indonesia-executive-summary-en-7ef72b832b9cf7d4.pdf. n.d. https://www.iisd.org/system/files/publications/financial-supports-coal-renewables-indonesia-executive-summary-en.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=financial-supports-coal-renewables-indonesia-executive-summary-en-7ef72b832b9cf7d4.pdf |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{internationalinstituteforsustainabledevelopmentndfinancialsupportscoalrenewablesindonesiaexecutivesummaryen7ef72b832b9cf7d4pdf, author = {{International Institute for Sustainable Development}}, title = {{financial-supports-coal-renewables-indonesia-executive-summary-en-7ef72b832b9cf7d4.pdf}}, institution = {International Institute for Sustainable Development}, 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} }