The construction of coal-fired power plants (CFPPs) in the North Kalimantan Green Industrial Zone (KIHI) is projected to cause negative economic impacts, including an output loss of Rp3.93 trillion, a decline in community income of Rp3.68 trillion, and losses of Rp51.5 billion in the fisheries sector. “Companies behind investment in coal-fired power plants need to urgently consider terminating any contracts or purchase agreements while the plants continue to be built,” said Bhima Yudhistira, Executive Director of CELIOS.
The ecological impacts are also significant, including deforestation, coastal erosion, and biodiversity loss. “KIHI is likely to drive deforestation, seabed dredging, pollution from thermal water discharges, coastal erosion, the destruction of water sources, and the loss of biodiversity,” said Fiorentina Refani, a CELIOS researcher. Government commitment and the implementation of net-zero policies are crucial to ensure that the project does not serve merely as a green façade to attract investment, according to Atinna Rizqiana.
CELIOS recommends halting all plans to build new coal-fired power plants and focusing on electricity supply from renewable energy. “Based on CELIOS’s study, we recommend that all green industrial zone developments comprehensively consider environmental aspects, halt all plans to build new coal-fired power plants, and focus on providing electricity from renewable sources,” said Bhima. OJK’s Green Taxonomy 2.0 should also exclude coal-fired power plants so that banks focus more on financing renewable energy power plants.
The construction of coal-fired power plants (CFPPs) in the North Kalimantan Green Industrial Zone (KIHI) is projected to cause significant economic losses, including Rp3.93 trillion in output losses, Rp3.68 trillion in reduced community income, and Rp51.5 billion in losses for the fisheries sector. “Companies behind these coal CFPP investments need to immediately reconsider any contracts or purchase agreements while these plants continue to be built,” said Bhima Yudhistira, Executive Director of CELIOS.
The ecological impacts are also severe, including deforestation, coastal erosion, and biodiversity loss. “KIHI tends to drive deforestation, seabed excavation, thermal water pollution, coastal erosion, destruction of water sources, and loss of biodiversity,” said Fiorentina Refani, a CELIOS researcher. Government commitment and the implementation of net-zero policies are crucial to ensure that the project does not serve merely as a green façade to attract investment, according to Atinna Rizqiana.
CELIOS recommends halting all new CFPP projects and focusing on renewable energy supply. “Our study recommends that every green industrial zone development must consider environmental aspects comprehensively, halt all plans for new coal CFPPs, and prioritize electricity from renewable sources,” said Bhima. The OJK Green Taxonomy 2.0 should also exclude coal CFPPs, ensuring banks focus their financing on renewable energy projects.