Ep 14 - Indonesia's Energy Transition Challenges (Climate Basics Podcast)
- Greg
- Jan 22
- 30 min read
This Blog:
summary of Ep 14;
notes and references related to Ep 14: and
AI generated raw transcript of Ep 14.
Summary of Ep 14:
1. Summary of the Episode
This episode of Climate Basics examines Indonesia’s role in the global energy transition, emphasizing the tension between its heavy reliance on fossil fuels—especially coal—and its extraordinary renewable energy and ecological potential.
Indonesia is a large, diverse, middle-income democracy of ~280–300 million people, spread across ~17,000 islands. Its economy has grown rapidly, but remains structurally tied to commodity exports—coal, palm oil, nickel, copper—patterns shaped by colonial history. Today, over 90% of Indonesia’s total energy consumption still comes from fossil fuels, with coal dominating both domestic use and exports (especially to China and India).
Despite this, Indonesia is uniquely exposed to climate impacts: sea-level rise, flooding, droughts, crop failures, coral reef degradation, and rainforest loss. These pressures are already reshaping policy decisions, including the controversial plan to relocate the national capital from Jakarta to Borneo due to subsidence and flooding.
The discussion highlights Indonesia’s untapped renewable advantages—geothermal (Ring of Fire), hydro, solar, wind, tidal—and the emerging opportunity to move up the industrial value chain, particularly in nickel and battery-related manufacturing. Nature-based solutions, especially mangrove restoration, are presented as both climate adaptation and economic resilience strategies.
The episode ultimately frames Indonesia as a critical test case: a country whose success or failure in transitioning away from coal will materially affect global climate outcomes, biodiversity protection, and energy-transition geopolitics.
2. Topic-by-Topic Breakdown
A. Indonesia: Scale, Diversity, and Economic Structure
~280–300 million people; world’s 4th-largest population.
~17,000 islands; >700 languages; extreme cultural and religious diversity.
Largest Muslim-majority country; Hindu, Buddhist, and indigenous traditions persist.
Classified by the World Bank as upper-middle-income, not “developed.”
High inequality: modern service economy alongside persistent poverty.
Electricity access ~99%, but reliability varies regionally.
Key framing: Indonesia’s geography makes centralized infrastructure expensive and energy transition uniquely complex.
B. Fossil Fuel Dependence and Coal Lock-In
>90% of total energy consumption from fossil fuels (electricity + industry + transport).
Coal is dominant, particularly for:
Industrial self-generation (smelters, refineries)
Electricity (~50–60% of generation)
Coal exports ≈ 3% of GDP (World Bank / IEA range).
Coal politically entrenched due to:
Regional employment dependence
Export revenues
Existing capital stock (plants, mines, ports)
Important nuance: Electricity ≠ total energy. Even if electricity decarbonizes, industry and transport remain major hurdles.
C. Climate Impacts Already Affecting Indonesia
Intensifying monsoons, drought–flood cycles.
Wildfires linked to land clearing and drought.
2023–2024: Indonesia becomes a net grain importer due to rainfall irregularity (FAO, Indonesian Ministry of Agriculture).
Jakarta:
Sea-level rise + groundwater over-extraction
One of the fastest-sinking megacities globally
Chronic flooding, infrastructure degradation
Key point: Climate impacts are no longer abstract; they are now macro-economic risks.
D. Capital Relocation to Nusantara (Borneo)
New capital city planned in East Kalimantan (Borneo).
Motivations:
Jakarta subsidence and flooding
Geographic centralization
Political symbolism
Risks:
Deforestation and biodiversity loss
Weak foreign investor uptake
Legal uncertainty (foreign land tenure restrictions upheld by courts)
Historical parallel: Brasília (Brazil) and Egypt’s New Administrative Capital—mixed outcomes, high fiscal risk.
E. Biodiversity, Mangroves, and Natural Infrastructure
Indonesia hosts:
World’s largest mangrove area (≈20–23% of global total)
Critical coral reefs (Coral Triangle)
Major rainforests in Sumatra, Sulawesi, Borneo
Mangroves:
Storm surge protection
Coastal erosion control
Extremely high carbon sequestration (“blue carbon”)
Fisheries regeneration
Local food security
Evidence: Mangroves sequester 3–5× more carbon per hectare than tropical forests (UNEP, IPBES).
F. Industrial Strategy: Nickel, Copper, and the Value Chain
Indonesia:
World’s largest nickel producer (~35–40% global supply).
Policy shift:
Raw ore export bans
Domestic refining and smelting mandates
Goal:
Escape “middle-income trap”
Capture more of the manufacturing value chain
Risks:
Coal-powered smelters
Environmental degradation
Local opposition
Key contradiction: “Green” minerals processed using coal weaken climate benefits unless power decarbonizes.
G. Renewables Potential (and Why It’s Underused)
Current status (approximate):
Renewables ≈ 14% of electricity
Renewables ≈ 4–5% of total energy
Major resources:
Geothermal: ~40% of global potential (IEA, World Bank)
Hydro & pumped hydro
Solar (equatorial)
Wind (localized)
Tidal & wave energy (straits)
Barriers:
Coal subsidies and legacy assets
PLN (state utility) balance-sheet constraints
Regulatory uncertainty
Low feed-in tariffs
Investor risk perception
H. Geothermal & Repurposing Fossil Infrastructure
Enhanced Geothermal Systems (EGS) borrowing fracking techniques:
Deeper drilling
Horizontal wells
Potential:
Firm baseload renewable power
Reduced need for storage
Risks (real, not hypothetical):
Induced seismicity
Water contamination (if poorly regulated)
Strategic insight: Reusing fossil-era assets and skills reduces stranded-asset resistance.
3. Follow-Up Questions
Q1. Is Indonesia really “one of the most important” countries for the global energy transition?
Yes. Evidence-based reasons:
Top coal exporter globally.
Large and growing energy demand.
Controls key battery minerals.
Hosts irreplaceable ecosystems.
Policy choices affect global emissions trajectories, not just domestic outcomes.
Sources: IEA, World Bank, Global Carbon Project.
Q2. Why hasn’t renewable energy scaled faster in Indonesia?
Primary reasons (ranked):
Coal’s political economy (jobs, regions, elites)
Utility financial constraints (PLN)
Investor risk (contracts, currency, courts)
Subsidies favoring fossil fuels
Grid fragmentation across islands
This is structural, not technological.
Q3. Does moving the capital solve Indonesia’s climate problems?
Does not address emissions
Introduces deforestation risk
Diverts capital from adaptation where people already live
Historical lesson: Moving capitals rarely solves underlying environmental governance failures.
Q4. Are mangroves really more effective than engineered defenses?
In many cases, yes.
Lower cost over lifecycle
Self-repairing
Co-benefits (fisheries, livelihoods, carbon)
Proven storm-damage reduction
Sources: UNEP, IPBES, World Bank Coastal Resilience studies.
Q5. Is geothermal realistically scalable?
Technically: yes.Politically and financially: conditional.
Indonesia has the resource. The challenge is:
Upfront drilling risk
Slow permitting
Grid integration
Financing cost
Without state-backed risk-sharing, scale will remain slow.
NOTES AND SOURCE REFERENCES FOR EP 14:
Indonesia is a huge nation, in terms of population, cultural and religious diversity, and global industrial importance.
About the same population as the entire U.S. nearing 300 million across 17,000 islands, over 700 languages still exist, each with their own cultural, ethnic, and ecological foundations.After centuries of being extracted from by larger forces, they’re starting to try and do more refining and processing within the country, taking over more steps of the value chain in a bid to overcome colonial-era exploitation for foods and minerals. If you’re eating rice or tofu or using an electronic containing nickel, cobalt, bauxite or copper, it might have come from Indonesia. They set a goal ten years ago to reach 6.5 gigawatts of solar 7.2 megawatts geothermal and 9.9 gigawatts of hydro, which they did reach. But still their electricity comes mostly from coal, which in addition to producing ⅔ of their own energy, is also exported to both India and China. Indonesian coal production has doubled in the past ten years,to nearly BILLION TONS, the #3 producer globally. They’ve recently discovered shale oil reserves about the size of Canada’s, which could become an ecological disaster/economic miracle of its own. All that said, Coal is still only about 3% of Indonesia’s GDP.
Its oil production is decreasing already, with clear indications that they’ll have to switch energy supplies in the next few decades, starting with following Brasil and the U.S. down the path of biofuels, though the sustainability of that sector is murky at best. It’s already consuming more gas fuels than it produces, by a widening margin. That might explain why it’s so interested in EVs. EVs have hit 14%, higher than many nations including the u.s. Which is almost at 8%. This is why they’re looking to become champions of refining, processing, and manufacturing - with half the global nickel production and many other key minerals, they have a unique potential for total economic autonomy - every step of the production chain can be done domestically! Very few places have ever achieved that.Now the ecological consequences of all this new industrial exploitation is massive - remember this is a place once rich in biodiversity - especially rain forests, coral reefs, and the rich fishing and agriculture that those support. Volcanism produces some of the richest soils possible, which when combined with rice terracing was producing some of the highest productivity food ever seen. This originally lush and productive environment has been disrupted by clearcutting, wildfires, all the regular suspects. On top of that Climate Change is changing rainfall patterns including more severe and unpredictable droughts and floods, and it has the fastest sinking capital city in the world, Jakarta, where sea level rise and poor water management leading to the draining of underground freshwater aquifers leading to subduction of the land into the sea.
There are plans to construct a new capital on Borneo, a largely forested island shared with Malaysia, and home to one of the largest remaining rainforests. The project imitates Brasilia, the centrally planned capital city constructed by the Brazilian government, and was to be a high-tech, investor-friendly modern smart city. Construction has had several issues so far.
There are alternatives Indonesia could continue industrializing in the 1800’s, primary industry style, but indonesians also have the option to reverse the ecological collapse and use nature-based solutions in tandem with clean industry to become global leader in next-generation manufacture, regenerative agriculture, mariculture, and electrification.They have the resources, and how they decide to grow is one of the remaining wildcards in terms of how the world is going to handle climate change. As stewards of a large portion of the world’s remaining biodiversity, and as the next most important actor after China, the U.S. and India, they have decisions to make that will affect all of us.
Total Primary Energy Consumption in Indonesia (2023)
Coal: ~52%
Oil & petroleum: ~30%
Natural Gas: ~14%
Renewables (Hydro, Biomass, Biofuels, etc.): ~4%
Nuclear: 0% (no commercial nuclear plants)(values approximate; sum = 100%)
Interpretation:
Coal remains the dominant energy source across the economy, driven by industrial use, electricity generation, and industry processing.
Oil — mainly for transport and industry — is the second largest.
Gas plays a significant but smaller role.
Renewables (excluding modern power) still represent a small share of overall energy use.This confirms that Indonesia’s energy consumption remains heavily fossil-dependent across total economy usage, not just electricity.
Indonesia’s mangrove ecosystems are a nationally significant environmental and climate resource:
Extent: Indonesia has about 3.3–3.44 million hectares of mangroves, representing roughly 20–23% of the global total, making it the largest and most diverse mangrove area in the world. (Wetlands International Indonesia)
Ecosystem value: Indonesian mangroves store ~3.14 billion tons of CO₂, supporting carbon mitigation, coastal protection, and fisheries productivity. (World Bank)
Policy role: Mangroves are incorporated into Indonesia’s Nationally Determined Contributions (NDCs) and land-use emissions strategies, reflecting their importance in achieving net sink targets by 2030. (World Bank)
Restoration planning:
The government’s ambitious restoration target — 600,000 hectares of degraded mangroves — was pursued by 2024 and into the current multi-year period through the Peatland and Mangrove Restoration Agency (BRGM), although progress has lagged relative to peatland programs. (Mongabay News)
Mangroves are part of the “Mangrove Breakthrough” initiative aligned with Indonesia’s national planning (RPJMN) and climate commitments through the latter 2020s, with future financing needs identified at ~IDR 47.6 trillion (USD ~2.85 billion) for 2025–2029, but less than 20% of this is currently secured. (Wetlands International Indonesia)
Summary:
Mangroves are both ongoing and planned as a major ecosystem priority in Indonesia — not a marginal activity — and are tightly linked to climate mitigation, adaptation, and biodiversity objectives.
Funding for mangrove restoration and conservation in Indonesia has come from a mix of national, international, private, and hybrid sources:
1) Multilateral and Development Finance
World Bank supports large-scale mangrove initiatives such as the Mangroves for Coastal Resilience Project, covering rehabilitation, conservation policy strengthening, and coastal community livelihoods. (World Bank)
Other global institutions and UN programs have provided technical and financial support tied to climate resiliency and biodiversity restoration. (The United Nations in Indonesia)
2) Government Agencies
The Peatland and Mangrove Restoration Agency (BRGM) coordinates national restoration programs and associated budgeting. These are state-led and often financed through national and local budgets and programs, though progress has varied. (Mongabay News)
3) Private Sector & NGOs
Corporate programs (e.g., PT Indika Energy’s IMPACT mangrove program) fund planting and community engagement. Such private sector sponsorship is part of CSR and ESG strategies tied to environmental performance. (The Jakarta Post)
Community-oriented and civil society group initiatives (e.g., Dompet Dhuafa, local NGOs) also contribute seedling production, planting, and maintenance, often funded via philanthropic capital including zakat (religiously mandated charitable funds) mobilized toward environmental work. (The Jakarta Post)
4) Emerging Market Instruments
Efforts are now exploring blue carbon finance mechanisms — i.e., payments for carbon sequestration by mangroves (carbon credits) — as an emerging source of funding and incentive alignment between private capital and ecosystem outcomes. (World Bank)
Integration with Indonesia’s emerging carbon market (e.g., linking mangrove conservation to tradable credits) is an explicit strategy. (Antara News)
Indonesia court shortens investor land rights by half in fresh blow to capital city project | Reuters - article says this ruling is final and binding, limiting ownership to 95 yrs
Raw Transcript (AI) for Episode 14:
0:00
In terms of fossil fuel use, uh, Indonesia is a fossil fuel user. They
0:06
just generally speaking, broadbrush, in terms of their energy consumption, they they are somewhere in the range of north
0:12
of 90% of their energy consumption comes from fossil fuels. Is that right? Unfortunately, yes. And the majority of
0:18
those fossil fuels are actually extremely dirty coal.
0:23
Welcome to Climate Basics, a podcast about the global energy transition and the challenges countries face. Presented
0:31
in an optimistic and realistic light. Here are your hosts, Tai and Greg. And
0:37
please remember to like and subscribe. Hi Ty. Hey Greg. How's it going?
0:43
Very good. Exciting topic this week. We are going to talk about the country of Indonesia.
0:49
That's right. really impactful in terms of economy, population, contributions to the world, uh resources and also uh
0:57
important ecosystems and biodiversity to protect. Right. I Well, it is a very important
1:03
country. It's a big player in its region. It's for those who are not particularly familiar with Indonesia,
1:08
it's it's obviously in Asia. It's close to Australia. But one thing that people may not appreciate is that its
1:14
population is massive. It's it's 280 million to 300 million people and they
1:20
are located on uh basically a string of islands. So they have sort of the bigger
1:25
portions of land but then they have hundreds or is it thousands of islands? I mean it's just 17,000 islands and over 700 languages
1:32
spread across them. it is a big big country and it is a significant power within Asia and also they are uh an
1:41
important issue uh for us to talk about when we're talking about the energy transition and the carbon footprint or
1:47
what have you. But before we sort of leave that, maybe you could give the uh listeners a little bit of background
1:53
about uh Indonesia, the country, you know, some of the economics like so I understand that they the primary
1:58
language tends to be uh Indonesian itself and that English is widespread
2:03
although it's not perhaps popularly used outside of the major centers and outside of business use. Um they are a democracy
2:11
and they they are a developed nation. they have um and I mean quite strong in terms of their GDP numbers, in terms of
2:17
their purchasing power ability um but within the country they also experience
2:23
quite a bit of economic disparity. The wealthy are wealthy like nobody's business but the poor actually can be
2:28
quite poor. From an an energy perspective they have an excellent uh electricity availability rate. It's
2:35
around 99%. Um it doesn't mean that some of the outlying regions have electricity 24/7 that is completely reliable but
2:41
they do have electricity but you know in terms of sort of understanding Indonesia maybe you could explain um to our
2:47
listeners. Yeah. Uh developed country is a term middle inome country is a term thrown a
2:53
lot thrown around a lot in Indonesia because like some other countries it's gotten to the point where it has a large
2:59
service industry but it's still kind of dependent on commodity and raw resources being exported to other countries. It's
3:05
kind of hard to get your entire economy out of that mode when it's how you were developed. So to go into that a little
3:11
bit, the history of Indonesia. Well, as you mentioned, they speak Bahasa and many other languages, but Bahasa is what
3:17
you'll find in Jakarta in the capital in Java. And uh Bahasa over the hundreds of years of colonization and uh economic
3:25
and cultural influence from the rest of the world has been influenced by many different cultures and languages.
3:30
There's little influences of Dutch and French and English because of different colonial forces. The East India Company,
3:36
if you guys want to Google that, did some absolutely wild stuff there in the 1600s, followed by other uh foreign
3:43
powers that really established the the long-term pattern of exporting
3:48
agricultural goods and raw resources from the country that still to an extent is the primary driving GDP for
3:54
Indonesia. It's also hugely influenced by India and China culturally. and you
3:59
see uh religions and architectural and linguistic patterns from all of South and Eastern Asia there. So it is uh
4:07
culturally incredibly diverse and linguistically incredibly diverse and uh
4:12
over the last few hundred years they have established their own uh independence as a nation but still
4:17
maintain very close ties with western powers with India and with China. And in fact when you look at what they're
4:23
exporting these days uh they're among the top producers for palm oil, nickel and copper. So basically all of your
4:30
food and all of your electronics possibly has ingredients from Indonesia. And over the course of the development
4:37
of all of those industries, it's unfortunately been a big win for international investors and a little bit
4:43
less of a win for local communities. Right. Well, when when you talk about diversity, they are um very diverse.
4:49
They're they are a melting pot. I I mean 700 languages just gives you sort of the scope of what they're dealing with. But
4:56
also even from a religion point of view, they they have sort of a diverse cross-section um represented, don't
5:02
they? Yeah, that's right. It's uh famously the world's largest Muslim country and also the mo Java is the most densely
5:09
populated island in the world. So you have this huge Muslim majority, but also traditions coming from ancient India of
5:16
uh Hinduism and Buddhism that still have a very powerful presence and you can still visit Hindu and Buddhist uh
5:21
religious sites across the islands. same as you can see mosques on you know every third quarter. So it it it it has
5:28
this unique position of being culturally diverse and hugely uh resourced. They
5:34
have agricultural production and available forms of renewable energy just from being volcanic islands with rich
5:41
soil and geothermal potential. Right. Well, I think that's a lovely segue into the fact that from an energy
5:47
transition point of view, from a global perspective, India matters. I I mean they're they're a big footprint and so
5:54
in terms of um watching how they are going to deal hopefully with their energy transition that's that really is
5:59
a matter of interest for people in the industry I think uh who are interested in this um so very similar in a sense to
6:07
India obviously much smaller than India 300 million versus 1.4 4 billion. But in terms of fossil fuel use, uh, Indonesia
6:14
is a fossil fuel user, they just generally speaking, broadbrush, in terms
6:20
of their energy consumption, they they are somewhere in the range of north of 90% of their energy consumption comes
6:26
from fossil fuels. Is that right? Unfortunately, yes. And the majority of those fossil fuels are actually
6:32
extremely dirty coal. Uh they also have some other petrol extraction and there
6:38
seems to be potential for shale fracking as well. But traditionally what has powered Indonesia's local industries has
6:45
been coal burning. They also export that their primary export partners for coal include India and China. So and it uh
6:52
accounts for about 3% of their GDP. So not an insignificant factor altogether.
6:58
Right. And so similar again to to India, you have domestically um a an industry
7:05
which is obviously very important for domestic stability in terms of employment in terms of regions within
7:10
the country. Maybe some regions depend on coal and fossil fuels a little bit more than say others for production. But
7:16
you also have a system where um it just takes a lot of money to convert over to renewable energy. So you have the coal
7:23
burning generation plants, you have the uh natural gas and oil burning generation plants, and you have them
7:29
with distribution and transmission lines over was it 17,000 islands, you said? I
7:34
mean, this is an infrastructure problem as much as as it is a bakedin fossil
7:40
fuel use problem. It is absolutely and I think that's one of the reasons why you see the
7:45
beginnings of a transition towards uh more distributed energy. Indonesia actually has one of the higher rates of
7:51
EV use on the streets right now. About 14% of all uh Indonesian vehicles are
7:56
EVs, and that's a growing percentage. Part of that might be because they don't actually produce a lot of oil that gets
8:03
refined to kerosene and gasoline themselves. They have coal, they have some natural gas, but they don't have a
8:08
lot of oil. So, it's been inefficient exporting a bunch of coal and importing a bunch of oil to run all the
8:14
everybody's little uh Hondas, you know, little scooters. It's the m the majority of the vehicles are scooters and it it's
8:20
not that hard to make a good e scooter now. So, Indonesia has this opportunity in specific sectors to transition away
8:26
from coal a lot faster because you know refineries, smelteries, uh specific
8:32
factories where you can have your own little power plant operating independently and buy coal to run that. That's where they're using most of their
8:39
in-house coal. their uh coal produces the grand majority for industrial
8:44
practices but only about half of their electricity generation. So it's on electrification uh EVs and grid
8:51
improvements and battery storage that they can really start making that transition real right. So, so you know it when you look
8:59
at a map and you see where Indonesia is and and you see where the latitude is uh
9:05
so you you know from a lay person's point of view I look at it and say my goodness this is perfectly positioned to
9:11
be a renewable energy superpower because you know on top of the solar and the
9:17
wind because of course they're an island nation they are also located on the ring
9:22
of fire which I guess is the volcanic area. So then geothermal comes into play and their natural sort of uh
9:28
architecture their landscape uh means that they also have quite a bit of pumped hydro but or and hydro power but
9:34
so so they do have renewables. I think the ballpark it's around 14% of their electricity production is renewables but
9:41
it's only about 4% of their overall energy use. But but why what are the challenges? Why is there not more solar,
9:48
more wind, more geothermal with Indonesia? It honestly hasn't been a high priority.
9:54
uh when you're making money from the export of coal, there's an incentive to continue expanding your coal production.
10:00
And generally, this the history of modern Indonesia has been trying to figure out who can invest in as many
10:08
bigger, newer refineries and extraction sites as possible. And and this is
10:13
interesting because you start seeing very directly the impacts of climate change more severely than a lot of the
10:19
rest of the world because as you said they have monsoons, they have typhoons and storms, they have unfortunately
10:26
increasingly irregular pattern of rainfall that's affecting their traditionally very high agricultural yields. This was a country that was
10:33
always agriculturally self-sufficient, always an exporter of grain until uh I
10:38
think it was 2024 when uh irregularities in the rainfall pattern ended up ruining
10:43
their crops and now they are a net grain uh importer. Okay. Wow. So, it doesn't seem like there's
10:50
ramifications to, you know, extracting large amounts of coal and selling them off to your trade neighbors, but uh none
10:56
of those neighbors are going to help when your your farms and your factories are flooded out. when there's a drought
11:02
and you lose off of your rice crop. So, we are seeing, especially in the global
11:07
south, like as you said, Indonesia is right on the equator. It's right in the center of so many climate impacts. And
11:14
unfortunately, as I as I said a minute ago, it's being hit a lot harder than a lot of other countries with the
11:20
wildfires in the jungle regions and severe storms and uh uh droughts and
11:26
flood cycles in the agricultural regions. Right. Yeah. and and so although they
11:31
are in an enviable uh geographical location for solar and for wind I I
11:37
suppose really what's happening is uh as you've explained the the government and private industry is more concerned with
11:43
just extracting more fossil fuels making more money now um but also it seems that
11:48
maybe their regulatory environment maybe is not as supportive in terms of even long-term offtake agreements for
11:54
renewable energy projects it's not as nearly as uh I guess supportive of as in
12:00
Europe, you know, the UK or Germany or the rest of Europe that those those governments perhaps have have focused
12:05
more on supporting and encouraging and subsidizing renewable energy projects in India, I guess, just just isn't there
12:11
yet. They are trying to attract private capital, but from my understanding is is that their their environment just is not
12:17
as attractive to make money for private capital as of yet. Indonesia has been trying for years to
12:23
try to become a reliable place for foreign investment and there are periods of that going extremely well. Uh and
12:31
also many periods where that investment ends up uh coming to not uh most recently they have started building a
12:37
new capital city on a different island than their industrial and population uh center uh in
12:43
Wait a second Jakarta is their capital and that is a major city. What are you
12:48
talking about? Jakarta is one of the biggest cities in the world and is a huge industrial hub. Uh I visited and
12:54
when I was flying in, you could see this across the sea surrounding the city
13:00
was shipping freighter after shipping freighter waiting to load and unload goods from Jakarta. It is an
13:06
international hub of the world. And uh why mess with perfection? It's sinking into the ocean.
13:14
So uh two things combining uh both related to climate change. One is that the sea levels are rising because more
13:21
ice is leaving Greenland and Antarctica and the Himalayas and and melting into the oceans. Now, in addition to the
13:28
oceans rising, the city itself is also, you know, sitting on top of a natural
13:34
aquifer like all land. And if you drain that aquifer for a fresh water supply to
13:40
uh you know deal with the thirsty citizens of your city and it doesn't replenish itself because the rain
13:45
pattern has changed, you end up having this collapse of the aquifers and that means subsiding which means basically as
13:51
the oceans are rising the city is starting to sink into the sea. And so freshwater problems for a hugely
13:58
populous city and flooding, regular flooding and slowly the shutdown and collapse of city infrastructure. And
14:04
their answer to this was not to not to climate change proof Jakarta, but to
14:10
just run off into the jungle to your least populous island in Borneo and build a new uh fantasy city like Brazil
14:17
did with Brazilia in the middle of the Amazon. They just started doing a planned city in the middle of nowhere.
14:22
And they really were trying to draw a lot of investors in for that. Indonesia was like, "This is going to be the smart
14:29
city. It's going to be high-tech. It's going to be super green and efficient. It's going to be a a captain of industry
14:34
and you're going to want you're going to want to have a corporate office there. Get in on the ground floor. Right. And and so similar to Brazil, I
14:41
think Egypt is also trying to do something similar. So yeah, they are. Yeah. And so Indonesia, so the new city,
14:47
I mean, they've thought about it and they're trying to put it geographically sort of in the center of all of these
14:53
islands and they're hoping that by locating to what is, you know, a natural
14:59
forest lands or or you know the just an area which is not populated, they're going to draw more people in there and
15:05
make it a smart digital city. So that those are their plans and they they have tried to uh attract foreign investment.
15:12
Um, I read just very recently, just a couple months ago, their final court, one of their final courts where the
15:18
ruling is binding, just knocked down the government initiative to allow foreign investors to purchase land and invest
15:23
there instead of having say 200 years of the land uh for freehold. Now it's only
15:29
95 years. And so that's just that's just adding on to a situation where foreign investment apparently was not, you know,
15:35
sort of desperate and flowing in to try to support this city. So I guess we'll have to see where that goes. Another
15:41
example is the president recently uh revoked I think about 25 different contracts with companies that were going
15:48
into the forested parts of Sumatra. Uh you know the places where it used to be rainforest and now it's monocultured uh
15:55
palm oil trees. Uh uh in some of those places they're starting to finally
16:00
realize how vital it is to maintain that critical global biodiversity. And so they're starting to get a little bit
16:05
more uh uh controlled in who they they give out contracts to for exploitation,
16:11
which is a re really really good news for everybody who cares about you know breathing the ecosystem continuing all
16:18
of that all those small things. Well, so so in terms of large uh natural um um
16:27
sort of uh infrastructure there um you've you've touched on this. They have rainforest. They have the coral reefs
16:34
and uh they also have uh mangroves which mangroves are of course in very
16:39
effective much more than say your average tree very effective for sequestering carbon. They're also able
16:45
to survive which is I think the big draw in salt water. They don't just die. you can actually plant them along the shore
16:51
and then sort of recreate that way. But maybe you can talk about the rainforest, the coral reefs, and also the the large
16:56
mangrove initiatives that have that have happened of late. Yeah. So, there's a few different reasons to care about
17:02
biodiversity. And if we're just sticking purely pragmatic, uh it's how in this
17:07
case, how you have your cities survive major storms. So mangroves provide this buffer where they take the kinetic
17:13
energy of the water coming on a typhoon, on a cyclone, on a hurricane, and they slow it down so much that it's as if it
17:20
was a storm several categories lighter when it finally hits the land. It can prevent flooding and it can prevent the
17:27
erosion of vital top soils. Tends to happen when there's a very heavy rain. Top soils wash away into the sea and you
17:32
have decades of lost work building up that soil microbiome and those nutrients in those soils. So it really can be
17:39
devastating. not just to the city infrastructure and to the people displaced when one of those uh huge
17:44
flooding events happens but it's also devastating for the ecosystem and for local industry. So the way you can
17:50
prevent that is very simply plant more mangroves, restore more mangroves, protect those sites and protect the
17:56
biodiversity that allows those sites to flourish best. When you have mangroves, they actually have an impact on the
18:02
alkalinity of the water around them. Uh we should do a different episode about
18:07
uh ocean acidification and how critical that whole issue is for uh ocean life at
18:12
all. Uh but one one of the best nature-based solutions for dealing with ocean acidity is having more uh
18:19
mangroves because those coastal ecosystems are actually uh they sink the
18:24
acidity and make it more alkaline the waters around them. They make these microbiomes that allow far far more
18:31
stuff to grow. And as you said, that means more carbon captured. So it really is one of the most important ecosystems.
18:37
And I believe Indonesia has the largest single collection of mangroves under one
18:43
management. Yeah, I think you're right. And they've they've been adding to it and and trying to restore their their inventory as
18:48
well. They've had some significant projects uh in the recent past as well. Yeah. And there's uh great economic
18:55
services that come out of that too. There's traditional fish fishing that used to be the majority of Indonesian
19:00
diet. uh that gets replenished when you have again those uh those mangroves restored
19:06
right and h how about Indonesia's rainforests I don't know very much about it at all but uh you know that's
19:12
significant uh rainforests are of course uh hugely important to the replenishing of the
19:17
oxygen of the atmosphere to the biodiversity that has provided so many vital medicines that so many people
19:23
depend on daily uh when we lose rainforests we don't just lose out on a nice place to go on a safari we lose out
19:30
on critical ical natural services that all of us have been depending on for longer than we can imagine. And so
19:36
there's really three major parts of the world where there still are rainforests. There's the Amazon region in South
19:42
America, the Congo region in Central Africa and in Indonesia primarily on three of the four largest islands in
19:49
Suluazi, in Sumatra and most importantly the largest contiguous rainforest left
19:54
in Borneo. Exactly where they want to put their new uh capital city.
20:00
Right. Right. Yeah. Um and and but so Indonesia has those challenges. They they also have a a
20:06
significant coral reef system. Yeah. Absolutely. And uh as I said, fishing was historically very important
20:13
for many of the traditional peoples that lived in different parts of the again 17,000 different islands across
20:19
Indonesia. Uh but that has shifted over time. There's more and more uh farmed
20:25
fishing, less and less caught fishing. There's depleted fisheries in many parts of the ocean and constant economic
20:31
pressure for local fishers uh fishermen to to somehow get more out of
20:37
collectively less and less. And so this is a place where if somebody wants to
20:43
come in with a development mindset and start doing next generation integrated multitrophic aquaculture that is to say
20:50
growing the fish with seaweeds and filter feeders by valves all integrated with each other. Indonesia has huge
20:57
amounts of space for that. If if Indonesia starts really trying to redevelop its agriculture and marulture,
21:05
then it could stay as it was historically up until just a few years ago a principal
21:11
a food exporter for the world. And unfortunately, if they don't, they might be sitting on the the last remains of
21:19
some of the most important ecosystems in the world. Right. Yeah. And well, Indonesia, they
21:25
do um economically um they appear to be doing quite well. Uh their their GDP is
21:30
growing year-over-year at an impressive pace. Um and they do have uh designs on
21:37
increasing their manufacturing particularly, you mentioned already, particularly in the area of nickel and
21:42
copper. Um and that may actually position them uh well with this energy transition and helping to provide these
21:48
minerals to other countries. Maybe you can explain what what those sorts of ideas uh revolve around.
21:54
Yeah. Uh Indonesia in short, as I said earlier, has historically been colonized. And that meant that their
22:01
industry practices are built around getting the raw material and getting it to whoever wants to buy it on the open
22:07
market. And that means when you do that that you lose out on what they call the value chain. That is to say, every step
22:13
in the process, refining it, processing it, putting it into a form that's uh viable, shipping it, turning that into a
22:20
manufactured goods, selling those manufactured goods, all of these steps before uh end consumption, each of them
22:26
tack on a little bit of price. So, somebody's getting a cut there. And when you are a traditionally colonized
22:32
country, it's not because you're poor or your resource poor. It's because your resources
22:37
are having those extra chains, extra steps in the value chain. added
22:42
somewhere else, not in house. Indonesia wants to finally get out of that mode,
22:47
which some economists argue is a big factor in the middle income uh trap of
22:55
actually starting to not just produce but refine and then use in manufacture
23:01
their raw materials. So because they are producing I think maybe a third of the
23:06
world's nickel. I know they're like the number one producer and a significant amount of copper and other vital
23:11
minerals that we use in all of our modern devices. Indonesia is
23:16
looking at this as an opportunity to become maybe one of the world's only fully uh autonomous industrialized
23:23
nations because they can do all of the food and all of the consumer goods and electronics in house
23:30
thereby getting all the steps of the value chain for them. Well, they haven't realized this yet,
23:36
but that's the idea and trying to get more investment for manufacturing. Right. Well, certainly um they they are
23:44
growing economically and hopefully they can incorporate at a faster clip uh the transition to renewables despite their
23:50
structural difficulties and problems. Um just just sort of following up on the
23:55
fact that they sit on the ring of fire and geothermal is potentially just this massive source. I I think the estimates
24:02
of how much geothermal energy they could get are just mindboggling because it's almost like an endless supply. But um as
24:09
good news this week. So we'll play the song here.
24:21
every day. And so as good news, um the economist
24:27
just recently highlighted that with the geothermal uh industry, it's still not
24:32
widespread, but it is looked at as being this very exciting source of excuse me,
24:38
firm power of base load really. Um, so I guess using the techniques of the shale
24:43
fracking, um, which allows for, um, both the the the the pipes that you are
24:49
sending down to go much further down, now they're thinking with geothermal is that using the the fracking techniques
24:55
of having your pipes go laterally, horizontally as well. And so I guess what that does is that allows you to
25:01
access just a wide geographic region underground, deep underground. So much
25:06
so that they're thinking that um with geothermal previously I guess the first generation or an earlier generation you
25:13
had to find you know specific locations which were good enough to to allow you to have geothermal not to deplete its
25:19
source and to provide enough energy. Now they're thinking with this new technique both deeper as well as horizontally that
25:26
it opens up just a huge uh number of options where you can actually sight geothermal almost anywhere anywhere that
25:33
you can get deep enough and access enough uh you know of the rock horizontally. And so that's just really
25:39
exciting because not every country is located on the ring of fire. And if other countries can can utilize this
25:44
using the shale fracking techniques for good, um if they can do this, then then of course now we're into a different
25:50
ballgame, which is that if you can have geothermal all over the place and it can act as your base uh load, then then
25:55
that's wonderful because then you don't even need batteries. The the the concept is is that you just use the energy during the peak hours when you need it
26:02
and then when you don't need it, you just don't draw the power and then you you wait again until peak energy uh requirements locally uh require it.
26:11
It's it's interesting too that we see this technology coming out of fracking tech which is I mean not a win for the
26:17
ecosystem although it was economically a a short-term win for the US and Canada. The tech being able to be used in green
26:24
energy is just a great metaphor for the type of transition we have to make. I know uh there are a lot of examples in
26:31
the oil industry of potentially what we call stranded assets. That is as we make the transition and as in different
26:37
regions we reach past peak oil production and into uh diminishing returns on investment for many types of
26:44
oil exploration. The uh and this is this has already started happening. The
26:49
offshore rigs get shut down. The old pipelines sit in disuse because there's nothing to to ship anymore through them.
26:56
Uh these types of assets are owned by major largescale corporations, big
27:01
economic players. And there gets to be this question of well what do we do with those resources and when we can find
27:07
another use like with geothermal for these uh uh fracking drills or uh ocean
27:13
thermal energy conversion for offshore o oil drill sites. Uh, I have also seen uh
27:19
co uh uh ocean ecosystem restoration projects mounted on uh offshore oil rigs
27:25
that have been abandoned and decommissioned as a as a project of trying to take something that was
27:31
harmful and turn it into something positive. Uh this is the type of way we have to be thinking so that we can have
27:36
fewer stranded assets because those stranded assets really slow down the the financial investment from the old way to
27:43
the new. Right? every time we can find a use for some of this tech, it it's a a
27:48
huge help, right? And and sort of stepping back and and looking um at a longer time frame,
27:54
30 year or 50 year time frame, I guess it's really just the natural progression, right? Like so the the desperate grab for money today allows us
28:03
to think that it's okay to to dig for fossil fuels and pollute the environment that we live in as well as the global
28:09
environment. It allows us to do ridiculous things like for example put as you just said oil rigs in the water
28:14
and then walk away from them as if that's a good thing. So you know but then taking this technology and using it
28:20
for something which is sustainable which is renewable like geothermal as long as you're not causing earthquakes and as
28:26
long as you're not ruining the water table. But if you can actually tap into what seems to be an unlimited source of
28:31
heat from the center core then that's wonderful. Then what you're doing is you're using the center core as well as using the sun above using the wind which
28:38
is available to everybody and uh you know it's brighter days ahead. Yeah. One final thing with regards to
28:43
Indonesia. Um they have significant hydro power and I guess maybe even uh pumped hydro maybe you can talk a little
28:49
bit about that before we uh leave our listeners. Uh yeah uh because of being in the ring of fire it is uh an
28:56
archipelago spotted with mountainous volcanoes most dormant uh some very much
29:02
not and uh in those places there's great potential kinetic energy capture in
29:07
terms of water flowing downhill uh another thing that I would they've developed hydro and they've developed
29:14
geothermal but one thing I don't hear about a lot from Indonesian energy is trying to take advantage of the awesome
29:20
tidal and wave energy that they have access to because they're in control of a lot of straits. In the Indian and
29:26
Pacific oceans, there's very fast water flows. And uh for example, on the southern coast of Java, there's a
29:33
tradition of the the uh ocean being notoriously violent there and it being
29:38
kind of a little bit dangerous to go out on the beach if you're not in a protected site because the tide can just take you away. So, anytime there's that
29:45
much extra energy sitting around, there's got to be a way to capture it, right? I'm talking about traditional
29:50
turbines and uh large large Yeah. large scale underwater turbines capturing some
29:56
of that flow. Right. Right. Excellent. Well, wonderful. Uh any last words about Indonesia, Tai?
30:02
Uh the food is amazing. I really love my time there. Uh Joe Jakarta is a beautiful city. Go check it out if you
30:08
want a different type of tourist experience. Excellent. Well, fantastic. Until next time, Ty.
30:14
Bye, Greg. And thank you all of you for listening. Thank you for listening to this episode
30:20
of the Climate Basics podcast. Please remember to like and subscribe and leave
30:25
us your comments. We look forward to seeing you next time. Goodbye.
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