sharing in governance of extractive industries

Government of Indonesia Urged to Comply with Its Own Policy on the Restriction and Reduction of Coal Production

JAKARTA - Ministry of Energy and Mineral Resources is urged to utterly implement the policy on the restriction and reduction of coal production on 400 million tons by 2019. Such policies are the mandate of the National Medium Term Development Plan (RPJM) 2015-2019 and the General Planning of National Energy (known as RUEN).


The coordinator of National Mining Advocacy Network (JATAM), Merah Johansyah Ismail said that his side doubting the government's commitment, moreover after the issuance of letter from Ministry of Energy and Mineral Resources to Ministry of National Development Planning that stated the coal production plan in 2017 reaching 477.91 million tons or 64.9 million tons higher than suggested by RPJMN, which is 413 million tons for the same year. "Do not let the RPJMN and RUEN just merely a document and not being implemented, and the coal production restriction just becomes a dream.”


According to Merah, the strategic move mandated by the RUEN other than coal production restriction is also the moratorium of coal mining permit (IUP) and special mining permit (IUPK) in the conservation forest, protection forest, production forest, and other usage areas. "Moratorium is really important to prevent the damage from mining in the protected area," said Merah.


To be known, at least there are 26 action plans related to coal mining sector in the Presidential Regulation Number 22 Year 2017 on RUEN that should be implemented with different targeted time. “Unfortunately, there is no strict rule about sanctions or disincentive mechanism if there any violation from companies and provinces," said Merah.


“Despite of all those things above, the government should be demanded to reduce the coal production in a greater number. The current number should be rechecked by highly considering the supporting capacity and carrying capacity of the environment and the ecosystem of the Indonesian archipelago. Today, 44% of the land and water area are coopted by the mining, 10% coopted by coal mining that overlap with 4.4 million hectares of productive agriculture land,” added Merah.


“The obligation to reduce the national coal production is not a sudden policy. The government of Indonesia has committed to holding down the earth temperature below 2 degrees due to climate change through climate change agreement in Paris and Morocco. Do not forget that coal sector plays huge role to decide the result of Indonesia’s agreement in decreasing the carbon emission by 29% (in business as usual) and 41% (if there are any international supports). It is the time for the government to stop issuing new coal mining permit,” said Merah.


Researcher of Coal Governance, Publish What You Pay Indonesia, Agung Budiono said that although the production trend is falling down, which is 434 million tons in 2016 compared to the figure in 2015 (461 million ton), it’s mainly driven by the drop of market price, not the production restriction policy imposed by the government.


“In fact, government revises the target in 2017, make it higher ironically. The government should impose special strategy to regulate the Coal Contract of Work (PKP2B) and Mining Permit (IUP) so that they comply with the restriction policy. The main obstacle here found in the provincial level, but the government should find a way out to execute its own policy”, said Agung.


According to Agung, at least there are two important things that should be existed in order to implement the coal production restriction policy. First, it needs a willingness and solemnity to change the energy management paradigm, which is to shift from dirty energy, such as coal.


“Government shouldn’t put coal as one of the source of fiscal and state revenue. Unless the government changes its paradigm, it’ll be difficult for Indonesia to lift its dependency toward fossil fuels. Also, political will plays significant role on this. If political will is in place, the room for compromising for other interest groups should be none,” underlined Agung.


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