A new report from the Global Energy Monitor (GEM), titled Boom and Bust Coal 2025: Tracking the Global Coal Plant Pipeline, highlights a significant contradiction in Indonesia’s energy strategy. Despite the country’s commitment to transitioning to cleaner energy, Indonesia continues to expand its coal infrastructure, creating a mismatch between policy goals and on-the-ground reality.
The GEM report notes that since the Paris Agreement was adopted in 2015, Indonesia has increased its coal-fired power plant (PLTU) capacity by 20 gigawatts (GW), bringing the total to 54.7 GW. This makes Indonesia the fifth-largest coal producer globally. The country is on track to add an additional 1.9 GW of coal capacity in 2024, which would place it among the top three countries in terms of coal plant capacity growth.
While 22 countries have reduced their coal-fired power plant capacities, Indonesia, along with China, India, and nine other nations, continues to expand its coal capacity. In fact, Indonesia’s capacity will grow by 1.9 GW in the near future.
According to the National Electricity General Plan (RUKN) for 2024-2060, Indonesia plans to add 26.7 GW of new coal-fired capacity over the next seven years, with 75% of this being captive PLTUs—plants built to serve specific industries. Indonesia currently has 130 captive coal plants, each with a capacity of 30 megawatts (MW) or more. An additional 21 plants are in the pre-construction or construction stages.
Much of this expansion is driven by the mineral downstream sector, particularly the nickel industry, which has led to a tripling of captive PLTU capacity from 5.5 GW in 2019 to 16.6 GW in 2024.
Lucy Hummer, a senior researcher at GEM, expressed concern over the inconsistency between Indonesia’s coal plans and its climate goals. “It’s like the left hand doesn’t know what the right hand is doing,” she said, pointing out the conflict between the country’s continued coal investments and its commitment to reducing carbon emissions.
Indonesia had previously signed the Just Energy Transition Program (JETP) Agreement, which included a pledge to halt new coal plant construction after 2022 and to phase out coal by 2050. However, the government has made exceptions for coal plants that are already part of the national electricity supply plan or are essential for national strategic projects, such as those supporting the nickel industry.
The rapid expansion of coal plants in recent years has led to excess capacity, costly long-term power purchase agreements, and widespread controversy. Zakki Amali, Trend Asia’s Research Manager, pointed out that little progress has been made on the early retirement of coal plants, a key component of the JETP agreement. Instead, coal use in Indonesia has surged.
“In fact, coal exploitation continues to increase, and captive coal-fired PLTUs are developing uncontrollably,” Amali said on April 11, 2025.
Amali also criticized the government’s new policies, which encourage religious organizations and small businesses to participate in coal mining. He warned that these policies could lead to environmental harm and exacerbate global warming.
According to Amali, Indonesia’s energy transition is at risk of failure. The country is still relying on coal plants, which are planned to remain operational until 2060, with plans to retrofit them to use alternative fuels such as ammonia, biomass, and possibly even nuclear power. While this strategy aims to reduce emissions, it is widely seen as uncertain and lacking a clear path to significant environmental improvement.
Hummer also voiced skepticism about these alternative approaches. She argued that co-firing coal with biomass could drive deforestation, and carbon capture and storage (CCS) technology remains unproven and unreliable.
With Indonesia’s coal expansion continuing at full steam, experts warn that the country faces significant challenges in meeting its climate goals, raising questions about the effectiveness of its energy transition strategy.
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