Decarbonization Pathways for Indonesian Manufacturing: Strategic Policy Insights

Indonesia’s industrial sector represents both a primary economic driver and a cornerstone of the nation’s climate commitments under the Enhanced Nationally Determined Contribution (ENDC). This policy brief synthesizes findings from empirical energy audits conducted across heavy industrial corridors in West Java and East Java.

1. Core Policy Dilemmas

While industry leaders demonstrate growing appetite for renewable adoption, regulatory hurdles around captive power grids and wheeling mechanisms continue to constrain rapid capital deployment.

"Decarbonization without robust, transparent policy alignment risks creating green transition bottlenecks for mid-tier enterprises."

2. Strategic Recommendations

• Establish transparent multi-stakeholder carbon accounting frameworks aligned with ISO 14064 standards.
• Incentivize co-generation bio-energy adoption for agro-industrial processing facilities.
• Strengthen institutional capacity within regional environmental enforcement agencies.

Through coordinated governance between ministries, industry associations, and academic research institutions, the roadmap outlines a resilient pathway toward net-zero manufacturing by mid-century.