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Sri Mulyani: 'Energy Transition to Put Forth Fairness, Affordability Aspects'

7 December 2021 13:38 WIB

Finance Minister Sri Mulyani. Instagram.com/@smindrawati

TEMPO.CO, Jakarta - Finance Minister Sri Mulyani on Tuesday’s Pertamina Energy webinar said Indonesia has committed to independently reducing carbon emissions by 29 percent, as mentioned in previous global events such as the COP 26 in October.

To accelerate the reduction of carbon emissions will be in the form of an energy transition policy. However, Sri Mulyani stated that this policy would be made with a detailed formulation by prioritizing aspects of fairness and affordability.

"Our focus is an affordable and just transition. Those who contribute to CO2 should have a bigger responsibility,” said the Minister on December 7.

One of the policies to accommodate the principle of equity in emissions reduction is carbon tax. As an instrument for controlling climate change, a carbon tax will be applied to the Coal Steam Power Plant (PLTU) sector on April 1, 2022, using a tax mechanism based on emission limits or “cap and tax.”

In terms of affordability, Sri Mulyani said the energy transition policy would take into account the people's limited purchasing power. She argues energy transition can be reached by 10-20 percent of people with the higher economic abilities.

However, the same conditions will not be felt by the 40 percent of the people with the lower economic class. She said the policy to encourage this energy transition cannot be made the same in all countries. All policies adapt to the unique conditions of each country.

“So the government in navigating a policy formulation must adopt the concept of common but differentiated responsibility globally. Because the income per capita of US$ 3,500-4,000 differs from those who have US$ 60 thousand per capita," said Sri Mulyani

Read: Sri Mulyani Calls Oil Production Decline a 'Challenging Situation'

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