The global push for energy transition and the adoption of New and Renewable Energy (NRE) in industrial sectors, including nickel, has become an urgent, non-negotiable mandate. However, achieving "clean energy" is far from simple. It is a dilemma shared by developed and developing nations alike: whether to accelerate a massive transition or delay it due to operational realities.

In Indonesia, this path requires more than just a clear roadmap and regulation; it demands substantial investment and cross-sector collaboration to achieve the ultimate goal of suppressing Greenhouse Gas (GHG) emissions across all chains of life.

This strategic urgency is underscored by Indonesia’s unparalleled position in the global market. Over the past decade, the global appetite for nickel has undergone a seismic shift, driven by the relentless march toward an electrified future.

With reserves accounting for around 40–42 percent of the world’s total, Indonesia has transitioned into the undisputed titan of the industry, contributing more than half of global nickel supply in recent years, with projections reaching up to 65 percent of the global supply. This dominance represents a critical pivot point for our national policy. The challenge for us today is no longer just about extraction, but about how we leverage this "green gold" to anchor ourselves at the heart of the global electric vehicle (EV) supply chain, ensuring our mineral wealth translates into sustainable, long-term national sovereignty.

To capitalize on this momentum, the government has rightly elevated downstreaming, hilirisasi, to a top-tier national priority. This structured industrial roadmap, reinforced by strict export bans and strategic commodity clustering, is the backbone of our ambitious 8 percent economic growth target, requiring an estimated Rp 13,000 trillion in investment over the next five years.

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However, we must move beyond a critical misconception: hilirisasi does not end at producing intermediate goods like nickel pig iron or matte. True downstreaming must be redefined as comprehensive industrialization—transforming our ore into actual batteries and high-tech components or end-products. Without this leap into advanced manufacturing, we risk missing the full economic multiplier effect that our reserves should provide.

Yet, this vision faces a sophisticated litmus test through frameworks like the EU Battery Regulation, which mandates a "battery passport" by 2027, and the U.S. Inflation Reduction Act (IRA). For Indonesia, these are market signals. If we fail to align with global carbon neutrality and traceability standards, our reserves risk being locked out of the most lucrative EV segments. We must ensure our industrialization is clean in its execution, turning ESG compliance into a competitive edge rather than a liability.

This brings us back to the energy paradox. While the market demands carbon neutrality, our infrastructure remains heavily reliant on coal due to geographical constraints and the need for affordable, stable power.

As I often emphasize, Western industrialization was built on over a century of coal, a resource they have largely exhausted, while Indonesia’s journey is in its infancy. Recent data shows that Indonesia has surged to the fifth-largest coal power capacity in the world, with total installed capacity reaching 54.68 GW. Of this total, a significant portion remains coal-based. Forcing an abrupt abandonment of this infrastructure without viable renewable alternatives ignores our historical right to industrialize.

As a fundamental principle, net zero does not mean the complete elimination of coal use. Rather, it calls for a managed and realistic transition, one that reduces emissions while maintaining energy security and industrial continuity.

Decarbonization, therefore, must be seen as a journey taken by industry players to align with Indonesia's 2060 Net Zero Emission target. We see proactive initiatives already taking root: from adjusting smelting technologies and utilizing biofuels (B40) to building solar power plants (PLTS). The transition, however, is dictated by geography. PT Vale Indonesia in Sorowako, for example, leverages a unique hydrological landscape of three interconnected lakes to operate three hydroelectric plants—Larona, Balambano and Karebbe. With a combined capacity of 365 MW, these plants power their furnaces sustainably and reduce carbon emissions by 1 million tons of CO₂ equivalent annually.

In stark contrast, operations in isolated regions like Harita Nickel on Obi Island face inherent natural constraints in power sourcing. For these frontier sites, coal remains a technical necessity to provide the massive, stable, 24/7 "baseload" power required to keep smelters running. Yet, Harita is not passive; they are actively suppressing GHG emissions through integrated solar power and hybrid systems. Furthermore, we can look to global benchmarks like Finland, which has successfully pioneered wave energy technology to harness maritime kinetic energy, a promising solution for Indonesia’s archipelagic geography.

To remain competitive, Indonesia must accelerate the adoption of advanced clean coal technologies as a strategic bridge. Ultra Super Critical (USC) systems, already proven by PLN at sites like PLTU Jawa 7, offer higher efficiency and lower emissions. Carbon Capture, Utilization and Storage (CCUS) represents the next frontier, serving as a strategic necessity to bridge the gap between our coal dependence and global green standards to reduce carbon emissions and maintain environment standards.

Ultimately, decarbonization is not an instantaneous destination but a disciplined and long-term transition. Its success depends on the alignment of consistent regulation, large-scale technological investment and sustained global market support. Indonesia’s vast nickel reserves represent a generational opportunity, but one that must be managed with a pragmatic balance between industrial realities and environmental ambitions.

The path to Net Zero Emissions will be neither short nor linear. The real test is not whether Indonesia can participate in the energy transition, but whether it can shape it on its own terms, advancing sustainability without compromising growth and asserting its place as both an industrial powerhouse and a responsible global leader.

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