Introduction


A JT in Indonesia’s energy sector will only be realized if climate ambition is matched with social justice. The energy sector is the country’s largest source of greenhouse gas emissions (ClimateWatch n.d. b), and national plans support decarbonization (Bappenas 2025). However, an explicit transition can create unequal burdens if it does not consider and address justice issues (Carley and Konisky 2020). This working paper applies the four justice dimensions developed by McCauley and Heffron (2018)—distributive, procedural, restorative, and recognition—to identify risks and risk- mitigation pathways in the energy transition. 

This paper pairs each subsector’s explicit energy transition pathways with implicit JT risks and risk-mitigation options. We consider the JT issues arising from two main types of transition: “phase-in” activities (e.g., the phase-in of renewable energy power plants), and “phase-out” activities (e.g., the phase-out of coal-fired power plants). Additionally, we combine top-down policy analysis with bottom-up stakeholder feedback to develop a contextualized JT process for each of the three subsectors. 

 

Key Findings: 


Indonesia's energy transition pathways are advancing, sometimes in detail, but gaps remain for a just transition (JT), whose varied definitions are reviewed in the introduction. Government roadmaps guide coal plant retirement, renewable energy growth, EV development, and industrial upgrades. However, they often overlook safeguards such as worker protections, economic diversification, affordability, and gender and social inclusion, as well as who bears transition costs—including responsibilities for protecting indigenous and local communities. 

  • Power sector policy pathways are clear, but social and financial consequences require careful management. The plan calls for shutting down coal plants early, scaling up renewable energy quickly, and building an interconnected grid to match supply with demand. This creates fiscal exposure for PLN and independent producers, as well as job and income losses in coal-reliant areas. Additional challenges include keeping electricity affordable for poorer households and ensuring inclusive decision-making. Success depends on reducing fossil fuel dependence, closing funding gaps, and improving nationwide energy access. 
  • Transportation decarbonization is progressing, though social equity concerns persist. The strategy relies on efficiency gains, greater biofuel use, EV adoption, and a shift toward public transit. This risks manufacturing job losses as ICE vehicles are phased out, demanding workforce reskilling. High EV upfront costs and inconsistent charging infrastructure may leave lower-income and rural populations behind. Weak battery end-of-life frameworks also raise environmental and worker safety concerns, since batteries aren't reliably collected, recycled, or disposed of. Meanwhile, fragmented governance undermines affordable, integrated mass transit and first/last-mile connectivity. 
  • Decarbonization pathways exist for cement and iron/steel (including nickel), but face cost, competitiveness, and regional challenges. Priorities include reducing clinker in cement, adopting cleaner fuels and carbon capture, shifting steel production to electric arc furnaces with cleaner power (eventually green hydrogen), and improving nickel smelter efficiency. Risks include costs passing to workers through job losses and to SMEs through higher production costs. Additional concerns include unequal regional access to clean energy, unsustainable biomass sourcing, and constrained circular feedstock supply—all carrying significant justice implications across distribution, process, restoration, and recognition. 

Way Forward: 

  • Crosscutting: prioritize a measurable and contextualized JT architecture for explicit energy transitions for all three subsectors. 
  • Power: pair CFPP retirement and expansion of renewable power with regional economic diversification, electricity affordability, and grid readiness. 
  • Transportation: center equity while accelerating efficiency, EVs, and superior public transport. 
  • Industry: push decarbonization while safeguarding workers, competitiveness, and regions.