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Several Developed Nations, Allied Groups Come Together With $10B Backing For Indonesia’s Efforts On Decarbonization – Citigroup (NYSE:C), Bank of America (NYSE:BAC)
At a G-20 meeting, a $20 billion funding plan was announced aimed at helping Indonesia, the world’s largest coal exporter, adopt renewable energy sources.
Developed countries, including the U.S. and some big banks, have backed the plan as part of efforts to help emerging economies decarbonize.
Analysts say $20 billion would be a start. Shifting Indonesia’s economy away from fossil fuels would require energy-sector investments of at least $2 trillion by 2050, according to a recent report by BloombergNEF.
Wall Street Journal reported that Japan, the European Union, Canada, and other governments besides the U.S. are expected to provide $10 billion over three to five years under the plan.
The rest of the funds are supposed to come from the private sector.
The Glasgow Financial Alliance for Net Zero said members, including Bank of America CorpBAC, Citigroup IncC, and HSBC Holdings PLCHSBC, worked on the plan.
The money will be used to invest in low-carbon energy so that 34% of Indonesia’s power generation will be renewable by 2030—roughly double the rate of deployment currently planned.
State Department officials said that investments in planned coal plants would be redirected to renewables and aims to close coal plants ahead of their intended lifespans.
The plan depends on overhauling Indonesia’s power sector. State Department officials said enacting the plan would start after Tuesday’s announcement while the Indonesian government considers potential policy changes.
That should involve setting up a competitive power-procurement system and speeding up wind and solar permits, a State Department official said.
