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Race to Net-Zero: The Role of Renewable Energy in Meeting Carbon Neutrality Target

The Indonesia Center for Renewable Energy Studies (ICRES), in collaboration with KADIN Net Zero Hub, RE100, WRI Indonesia, and Mt. Stonegate Green Asset Management, held a workshop on February 14, 2023, with the topic "The Role of Renewable Energy in Meeting Carbon Neutrality Target". The event brought together various experts to share their latest research, insights, and best practices, among them Paul Butarbutar, who acted as moderator and introduced ICRES and the objectives of the event, Surya Darma representing ICRES, Madeline Pickup representing RE100, Octavianus Bramantya representing KADIN Net Zero Hub, Tatwadhika Siddhartha representing WRI Indonesia, and Albert Sutanto representing Mt. Stonegate. The event was attended by around 50 participants from various backgrounds.

Surya Darma explained the "Importance of Renewable Energy in Achieving Net-Zero Emissions" in Indonesia. He started the presentation by introducing ICRES’ missions and objectives, which aim to support the government's efforts to transition energy toward net-zero emissions through dialogue and the exchange of knowledge and experiences. TREN-D, or Think Renewable Energy for Decarbonization, will be the flagship that will be used by ICRES to facilitate dialogue between national and international experts and policymakers.

Surya Darma explained the current global trend in energy, transitioning from high-GHG-intensive energy sources, such as coal and crude oil, towards cleaner and renewable energy. He mentioned that Indonesia, with its abundant renewable energy potentials such as Solar, Hydro, Bioenergy, Wind, Geothermal, and Tidal, can transition towards renewable energy and meet the net-zero emission target by 2060 or earlier. However, this transition toward renewable energy technology needs to be well-planned and implemented gradually. This is important to mention since Indonesia has been depending on fossil fuels for a long time. There are a huge number of people who depend on fossil fuels for energy. Therefore, it needs just enough energy transition without jeopardizing energy security and affordability.

Further, Surya Darma highlighted that in honour of the 100 years of Indonesian Independence Day, when Indonesia would be expected to become part of the Big 5 with the highest GDP, the required economic growth needs to be in line with this just energy transition, meaning Indonesia must rely on renewable energy sources as energy sources. For an energy transition to happen, Indonesia will need huge investments in energy infrastructure and human resources that can drive this transition. Moreover, the government needs to establish a strong legal base that could encourage investors to invest in renewable energy.

Madeline Pickup from RE100 spoke about "RE100: Corporate Demand Shifting the Global Renewables Landscape." She introduced the RE100 initiatives, their policies, and the growth of members who are committing and disclosing their emissions by joining the RE100.

The importance of renewable energy in achieving net-zero emissions cannot be overstated, and many businesses are leading the way in the transition to sustainable energy practices. The global RE100 campaign is encouraging suppliers to invest in renewable energy and changing the demand for renewable energy. She mentioned that over 390 members have joined the effort so far, indicating the campaign’s significant success. Small and medium-sized businesses are expected to follow major organizations’ lead and switch to renewable energy sources as a result of the ripple effect.

One of the highlights from Madeline’s presentation is the market transformation that is happening in Asia. Several countries, including Japan, Taiwan, Korea, India, Vietnam, and the Philippines, have made significant progress toward the RE100 initiatives.

Octavianus Bramantya from KADIN Net Zero Hub spoke about the "Industry Net Zero Trend". He introduced the net-zero trend at the industry level by using a reference from the "neo-classical circular flow model." He mentioned that every corporation can contribute to the transition toward net zero, and governments can create new policies, but we as consumers should be able to control the resources that we are using.

The Science-Based Targets Initiative (SBTi) will serve as a benchmark for multinational corporations' pledges to achieve net-zero emissions targets. According to SBTi, in 2021, over 2,253 companies will commit to setting their targets to SBTi. The trajectory of reaching emissions reductions based on the 2019–2020 period is around 12.1% compared to 5.2% globally. These emissions reduction targets from corporates are demonstrated by the emergence of new technological inventions such as tidal waves, geothermal, wind and hydro.

One of the highlights of Bram’s presentation is the implementation of CBAM in EU nations. The laws will have an impact on several industrial sectors, including cement, steel, and others, and future initiatives will target more industries. He concludes that current customers are beginning to use low-emissions products, and public awareness is rising. These worldwide changes will take place as a result of the market forces driving company transformation and the net-zero initiative.

KADIN pushes corporations in Indonesia to validate their net-zero emissions. In the industry, committing to net zero is a new type of TREN-D. The private sector is ready to take the initiative and make progress in the decarbonization initiative. Positive government signals in the form of policy improvements will also be required to advance.

Tatwadhika Siddhartha spoke about "Corporate GHG Inventory Accounting Scope 1, 2, and 3". He introduces the GHG Protocol, Supply Chain Mapping in understanding organizational boundaries, and steps in calculating the GHG calculation.

He first introduced the GHG emissions accounting, management, and reporting system. The GHG protocol standards and guidance will enable companies to report and disclose all of their emission reductions. This is crucial for companies to effectively manage their environmental impact and achieve sustainability goals. By tracking their emissions with the right methodology, companies can identify areas for improvement and develop effective strategies to reduce their carbon footprint and increase competitiveness of the company.

He mentioned the Corporate GHG Inventory accounting methodology, which refers to the process of quantifying and reporting an organization’s greenhouse gas (GHG) emissions. These emissions can be categorized into three scopes: scope 1, scope 2, and scope 3. Scope 1 emissions are the direct emissions from sources that the organization owns or controls, such as transportation fleets or on-site combustion facilities. Indirect emissions from purchased steam, heat, or electricity are referred to as scope 2 emissions. Scope 3 emissions are the remainder of indirect emissions that happen along a company’s value chain, including emissions from transportation, suppliers, and product consumption.

In his presentation, he mentioned the three basic steps in calculating the carbon footprint. The first step is to set the reporting period and base year for calculating the GHG emission inventory. Second, identify emission sources based on the three scopes. Third, choose the calculation method, and finally, collect data and select the emission factors that will be used and can provide the greatest accuracy.

One of the highlights from his presentation is he mentioned that to achieve Indonesia's net-zero targets, they will need a strong baseline for counting their GHG emission factor. A baseline enables precise tracking of emissions over time and serves as a starting point for evaluating progress. He concludes that a solid baseline for measuring GHG emissions is crucial to Indonesia’s attempts to combat climate change, reduce the scope 2 emission factor to reach net zero, and raise Indonesia’s competitiveness from other countries.

Albert Sutanto spoke about "Corporate Emission Reduction Strategy: Renewable Energy". He began with an overview of Mt. Stonegate and the consulting services, project management, and renewable energy sectors that they can offer. He noted that corporates can reduce their emissions targets by purchasing Energy Attributes Certificates (EACs).

He mentioned that Indonesia’s approach to the purchasing of electricity is still controlled by the state’s electricity (PLN). The regulatory framework for PPAs has been slow to develop and is often seen as unpredictable. Unlike other countries where PPAs for renewable energy are widely available, Indonesia has struggled to attract investment in renewable energy due to a lack of regulatory clarity and inconsistent policies.

He mentioned that EACs were developed to track the environmental and social attributes of electricity generation and use, such as the type of energy source used (wind, solar, hydropower, etc.), the location of the generation facility, and the emissions associated with the electricity generation. This allows organizations to demonstrate their commitment to using renewable energy sources and reducing their carbon footprint. By purchasing EACs, organizations can support the development of renewable energy sources and contribute to the growth of the renewable energy sector.

One of the highlights from the presentation is that currently there is a new global trend in the procurement of green energy by corporations. He concludes that purchasing these green energy certificates can be a signal for stakeholders to develop more Renewable Energy projects and increase the number of industries and corporates joining RE100 to achieve net zero.

Prof. Dr. Agus Hermanto, Member of the Supervisory Board of ICRES and former Vice Chairman of the Parliament of Indonesia (Dewan Perwakilan Rakyat), spoke about the renewable energy progress in Indonesia. The availability of the draft law on new and renewable energy (RUU EBT) , is a significant step toward the country’s transition to a more sustainable energy system. With this important achievement, he hopes that Indonesia can make significant progress in transitioning to a net-zero country and that the renewable energy target can be strengthened.

The event was concluded with a Q&A session and closing remarks by the speakers.

You may download the speakers’ slides from the links below:

1. Surya Darma_Importance of Renewable Energy in Achieving Net Zero Emission - Tren-D Dialogue-ICRES_Feb 23

2. Madeline_Slidedeck RE100 for Indo ICRES session

3. Octavianus Bramantya_NZH_ICRES_220213

4. Tatwadhika Siddhartha_WRI Slidedeck - Feb14 ICRES 5. Albert Sutanto_230214_Workshop_Jakarta_Albert

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