Jakarta, ResponsiBank Indonesia – Indonesia has committed to reducing carbon emissions with a target of 32% or the equivalent of 912 million tons of CO2 by 2030. This target will encourage an increase in new renewable energy electricity generation capacity, one of which will be realized through nickel as a battery material for electric vehicles.
In contrast to the total nickel reserves in Indonesia which reach around 72 million tons or the equivalent of 52% of world nickel reserves, to date, Indonesia is only able to produce nickel up to Mixed Hydroxide Precipitate (MHP) or one step before nickel sulfate. Nickel in Indonesia that is used for electric vehicles is still very small or only around 1%, while 80% of nickel used for export in medium (semi-finished) form is exported to China to be used as a basic material for making stainless steel.
The Executive Director PRAKARSA and the Coordinator of the ResponsiBank Indonesia Coalition, Ah Maftuchan, said that the 2024 general election (Pemilu) for presidential and vice presidential candidates this time needs to be used as a momentum to discuss matters that are substantive and go beyond just a struggle for power.
"Especially the themes of a just energy transition, sustainable finance and the environment can be seriously discussed by all presidential and vice presidential candidates who are currently contesting," said Maftuchan, in his remarks at a public discussion with the theme Measuring a Just Energy Future in the Nickel Based Industrial Area at the Le Meridien Hotel, Sudirman, Central Jakarta, Tuesday (9/1/2024).
From the results of media content analysis conducted by The PRAKARSA (2023) found that discussions from government actors regarding nickel industrialization in Indonesia were dominated by discussions on economic aspects, such as electric vehicle batteries and downstream nickel industry, while the negative impact on the environment and human rights issues had not been seriously discussed.
Apart from that, Novi Onora, TuK Indonesia researcher, added that negative impacts such as environmental damage and human rights violations are important aspects that need to be considered due to the presence of the nickel industry. Local residents, including indigenous communities, bear the brunt of environmental damage, and some of them lose their living space because the forest areas they live in are turned into mining concessions without paying attention to the aspirations of the community. As TuK Indonesia found in Bahodopi, Morowali, Central Sulawesi, based on the results of measurements on the water quality index, air quality index and land cover quality index.
"Water quality measurements show that the water in the river and sea around PT Indonesia Morowali Industrial Park (IMIP) is polluted. "The polluted conditions that occur have an impact on reducing the value of dissolved oxygen, apart from that, polluted conditions in the sea have the potential to cause loss of livelihood for fishermen and seaweed farmers as well as damage to coral reefs," he explained.
However, Novi explained, the environmental quality index in Bahodopi District is in the very good category, because forest land cover still dominates the Bahodopi district area compared to other land cover or uses. "In fact, in the context of mining extraction, the area of land cover cleared tends to be less than the extent of extraction in the monoculture plantation sector. "This is also a critical point in calculating the environmental quality index based on government standards, namely the standards set by the Ministry of Environment and Forestry in 2018," he added.
Meanwhile, from the financing aspect, Researcher The PRAKARSA Ricko Nurmansyah revealed that the nickel industry in Indonesia is largely funded by investors from China who are recorded as investing in developing downstreaming, even of the 248 nickel smelter furnaces in Indonesia, 137 furnaces are affiliated with Chinese investors.
"The results of tracing financial flows are dominated by capital from China, much of which is invested in Sulawesi, Halmahera or North Maluku," said Ricko.
Furthermore, Abdul Haris, Head of the TuK Indonesia Campaign and Public Education Department, added that there are 5 myths about the energy transition in Indonesia. "Until now, the energy transition is still a myth, including stopping PLTU, new renewable energy, exploitation in the name of transition, environmental friendliness, and people's welfare and prosperity," added Haris.
The vision and mission of the presidential candidates need to be strengthened
The energy transition has actually become an agenda campaigned for by the three pairs of candidates (paslon) participating in the 2024 presidential election. However, there are several things that need to be paid attention to by these three candidate pairs. First, in terms of implementing aspects of the Social Environment and Governance (LST), the three candidate pairs have written their commitments in the vision and mission document. However, these three candidate pairs have not stated the extent of the interventions they will carry out in their implementation of ESG aspects, especially in terms of financing flows. For example, there has been no statement of firm action against national or international banks that continue to finance dirty energy sectors which are proven to have negative impacts on the environment, economy and social.
Second, the candidate pairs have not paid attention to and provided complaint facilities (grievance mechanisms), action, and forms of accountability for vulnerable affected communities living around mining areas, including groups of women, people with disabilities, indigenous communities, children and the elderly.
Third, there is a lack of concrete policies from the three candidate pairs related to environmental sustainability alongside nickel exploitation. Despite the expressed commitment to nature conservation, there is still no clear plan regarding post-exploitation land restoration, which raises questions about the long-term viability of these practices.
Spokespersons for the three presidential and vice presidential candidates were challenged to think about alternative funding for the energy transition and early retirement of PLTUs, more responsible investment, and include revisions to environmental protection instruments and the fulfillment of human rights, especially for vulnerable groups.
