According to Indonesia’s Greenhouse Gas (GHG) Inventory Report, as presented in its Third Biennial Update Report (BUR3) submitted to the UNFCCC in 2021, the country’s primary sources of GHG emissions come from the Agriculture, Forestry, and Other Land Use (AFOLU) sector and the energy sector, contributing 50.13 percent and 34.49 percent, respectively. However, emissions from the energy sector are projected to surpass those from the forestry sector by 2030.
Reducing emissions from both sectors is key to achieving Indonesia’s climate commitments. Therefore, the government must ensure that mitigation actions in the energy sector under the Second NDC do not undermine efforts to reduce deforestation and forest degradation.
A review of mitigation measures in the energy sector under the Enhanced NDC (ENDC) highlights several plans that require closer examination due to their implications for forests and land, namely:
(1) biofuel utilization,
(2) biomass co-firing in coal-fired power plants, and
(3) electrification.
Challenges and Risks of Biofuel Utilization
The ENDC sets a significant biofuel target—B40, with a projected utilization of 18 million kiloliters of FAME by 2030.
Indonesia needs to reduce its dependence on palm oil as the primary feedstock for biofuel, given the strong link between oil palm expansion, natural forest deforestation, and forest fires.
In 2023, more than 27,000 hectares of primary forest were lost within oil palm concession areas (GFW 2023, analyzed by MADANI Berkelanjutan). In addition, approximately 128,000 hectares were identified as burned within oil palm concession areas (Indicative Burned Area 2023, MADANI Berkelanjutan).
Risks of Biomass Utilization
Plans to expand biomass use are also expected to increase pressure on Indonesia’s natural forests.
To meet biomass demand for 107 coal-fired power plants with a 10 percent co-firing rate, Trend Asia estimates that at least 2.33 million hectares of Energy Plantation Forests (HTE) would be required.
Such large-scale HTE development poses deforestation risks, considering that historically, 38 percent of industrial plantation forest cover in 2019 originated from natural forest conversion.
Impacts of Renewable Energy Expansion
Renewable energy development—particularly the expansion of nickel mining and processing industries to support electrification—also carries deforestation and land conversion risks.
Since 2001, more than 117,000 hectares of primary forest have been lost within nickel concession areas (GFW 2023, analyzed by MADANI Berkelanjutan).
Indonesia currently lacks an integrated land-use roadmap within its energy transition policies that mandates deforestation- and peat-free development. As a result, bioenergy and electrification initiatives still risk driving forest and peatland conversion—both directly and indirectly.
Moreover, the ENDC does not yet include commitments to address potential trade-offs between biofuel expansion and food security, biodiversity conservation, and efforts to reduce deforestation and forest fires.
Recommendations to Strengthen Indonesia’s Climate Commitment in the SNDC
Yayasan MADANI Berkelanjutan proposes several recommendations to reinforce Indonesia’s climate commitments in the SNDC:
1. Deforestation-Free Guarantee
The SNDC must ensure that energy transition pathways—whether electrification, biofuel, or biomass utilization—are implemented without damaging natural forests and peatland ecosystems. The SNDC roadmap should incorporate an integrated land-use plan that explicitly requires deforestation-free and peatland-free development.
2. Diversification of Biofuel Feedstocks
The government should adopt a sustainable biofuel feedstock diversification strategy that does not compete with food needs. Feedstocks derived from waste and residues—such as used cooking oil—should be prioritized to minimize land pressure. This approach should be accompanied by democratized and decentralized biofuel development based on local potential, prioritizing local needs. In addition, the government must develop a rights-based integrated land-use plan to prevent deforestation, forest degradation, food land loss, biodiversity loss, and violations of Indigenous and local community rights.
3. Climate Justice
The government should strengthen the synergy between mitigation actions and sustainable development goals by adopting climate justice as a core framework for both adaptation and mitigation strategies. This includes respecting human rights, recognizing community rights, and ensuring meaningful participation of vulnerable groups, including persons with disabilities, Indigenous and local communities, smallholder farmers and traditional fishers, marginalized women, urban poor communities, children, older persons, and other at-risk groups.
By implementing these measures, Indonesia can achieve its climate targets without sacrificing forests and land that are essential for ecosystem sustainability and the livelihoods of Indigenous and local communities.
