Indonesia to Start Carbon Trading for Coal-fired Power Plants


The Energy and Mineral Resources Ministry aims to reduce 500,000 tons of carbon dioxide (CO2) emissions through the carbon trading scheme this year. According to the plan, 99 coal-fired power plants – 55 are owned by PLN and others belong to independent power producers (IPP) – will join the commercial carbon trading scheme that commenced earlier this year.

"We estimate this year's [emission] reduction reaches 500,000 tons. Indeed if you look at the figure of 250 million tons coming from the electricity sector, this is only one out of 500, not big," Energy Ministry's Acting Director General of Electricity Dadan Kusdiana said in Jakarta on Tuesday. Nevertheless, the carbon emission reduction from power generation is relatively progressive. The target is equivalent to building renewable energy plants with a 0.5-0.6 gigawatts (GW) capacity.

Dadan said that carbon trading in the electricity sector does not interfere with the economic value of the electricity supply costs [BPP] from 99 PLTUs. "This efficiency improvement does not require costs, so it will not increase BPP in the power plant," he said.

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