Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia

The report analyzes the potential economic shocks of phasing out coal in Indonesia, identifying East Kalimantan as the most vulnerable province. Using a mixed-methods approach, it demonstrates that while mine closures cause significant losses in output and employment, targeted stimulus in the food and beverage and green sectors can drive recovery. The study emphasizes the disproportionate impact on informal workers and women, recommending a transition roadmap that integrates gender equality, disability, and social inclusion (GEDSI) principles and expands social safety nets.

• East Kalimantan is the most economically vulnerable province to coal phase-out, with projected output losses of IDR 628.35 trillion (USD 41.89 billion), sectoral income declines of IDR 82.65 trillion (USD 5.51 billion), and employment losses exceeding 490,000 jobs.
• At the regency level, East Kutai and Muara Enim are the most economically exposed. East Kutai faces output losses exceeding USD 18 billion and employment losses over 18,000, while Muara Enim faces an output loss of USD 10 billion and higher job losses of approximately 24,500.
• Scenario 2, which targets sectors with the highest output multipliers (specifically food and beverage), is the most effective for maximum GRDP recovery, though it requires the highest fiscal stimulus.
• Scenario 3, focusing on green sector development, is the most cost-efficient for restoring output and maximizing employment gains, creating millions of jobs in provinces like South Sumatra (3.14 million) and East Kalimantan (2.58 million).
• Informal workers are highly prevalent in coal-dependent communities; in the studied area of Swarga Bara village, 58.8% of respondents were informal workers, primarily in food and beverage services and retail.
• Women in coal mining communities often occupy dual roles, managing households while earning lower median incomes (IDR 1.25 million) through informal work, such as small food stalls or catering.
• Existing Indonesian social protection tools, such as Kartu Prakeja and BPJS Ketenagakerjaan, are insufficient for a just transition because they were not designed for green jobs and often exclude informal or precarious workers.
• A mixed-methods research approach is recommended for just transition planning because quantitative modelling alone cannot capture gender and social inclusion (GEDSI) impacts, which require qualitative methods like focus group discussions.

APA

Sundari, R. M., Firmansyah, A. D. A., Oktavilia, S., Azyzia, S. H., Prayogi, R., & Vazi, B. (2025). Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia. International Institute for Sustainable Development. https://www.iisd.org/system/files/2025-11/just-transition-coal-indonesia.pdf

Chicago

Sundari, Refina Muthia, Anisa Dwi Ariyani Firmansyah, Shanty Oktavilia, Siti Hilmiati Azyzia, Ryan Prayogi, and Bathandwa Vazi. Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia. International Institute for Sustainable Development, 2025. https://www.iisd.org/system/files/2025-11/just-transition-coal-indonesia.pdf.

Wikipedia

{{cite report |last1=Sundari |first1=Refina Muthia |last2=Firmansyah |first2=Anisa Dwi Ariyani |last3=Oktavilia |first3=Shanty |last4=Azyzia |first4=Siti Hilmiati |last5=Prayogi |first5=Ryan |last6=Vazi |first6=Bathandwa |title=Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia |publisher=International Institute for Sustainable Development |date=November 2025 |url=https://www.iisd.org/system/files/2025-11/just-transition-coal-indonesia.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sundari2025coal, author = {Sundari, Refina Muthia and Firmansyah, Anisa Dwi Ariyani and Oktavilia, Shanty and Azyzia, Siti Hilmiati and Prayogi, Ryan and Vazi, Bathandwa}, title = {{Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia}}, institution = {International Institute for Sustainable Development}, year = {2025}, month = nov, url = {https://www.iisd.org/system/files/2025-11/just-transition-coal-indonesia.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }