Indonesia’s ambitious plan to ‘go green’ offers ample opportunities for Western Australia, according to Matt Golds, CCIWA’s Chief Operating Officer.
Potential for WA to collaborate with Indonesia to support its transition to greener energy was highlighted at the Invest and Trade WA Indonesia Connect Roadshow in September. Discussions focused on identifying new sources of energy and actions required for the transition.
“Indonesia has a bold vision to transition to renewable energy and the Indonesia Connect Roadshow strengthened WA’s ties with Indonesia, solidifying our strong trade and investment support as neighbours,” says Golds.
“Our rich sources of critical minerals and the hive of activity in major energy and mining projects already in production and under development, will see WA be a crucial trade partner for jurisdictions with green ambitions, such as Indonesia.
“WA is in the front seat of the global energy transition, representing a major opportunity for investors.”
Energy projects are a key sector for Indonesia
Indonesia is the world’s largest exporter of coal, however it has committed to spending $20 billion to transition to greener energy.
Over the next three to five years, the country plans to use the funds to accelerate the retirement of its coal plants and ramp up renewable energy development.
Details of Indonesia’s Just Energy Transition Partnership (JETP) investment and policy plan are yet to be made public as it is still under review by the Government and JETP partners. It currently suggests Indonesia will reach net zero by no later than 2060.
The country is also the biggest producer of nickel ore and since 2020, exports of the raw material have been banned. The aim of the ban was to develop Indonesia’s nickel supply chain and produce downstream materials and products.
While Indonesia has significant industrial challenges to overcome, including technological upgrades of its nickel reserves and transitioning away from coal (from which it generates more than 50% of its energy), the strategy has made inroads.
About 68% of the world’s nickel is used in stainless steel production. As production of electric vehicles (EV) grows – nickel is a crucial material for EVs battery cathodes – demand for nickel is expected to increase exponentially.
Indonesia wants to position itself as a global leader in nickel processing and the EV industry. But it needs to import other critical materials required for EVs, including lithium, which Australia has in abundance.
“Indonesia has the world’s largest nickel reserves, Australia [is] the world’s largest main lithium producer. I think this will be a global effort to promote green transportation for a greener world future,” Indonesian President Joko Widodo told the Australian Financial Review in July 2023.
“I will focus on this. This is very important for Indonesia and also for Australia.”
WA Energy Minister Bill Johnston echoed President Widodo’s sentiment at the Indonesia Connect Roadshow.
“With WA’s critical minerals and rare earth resources, our State is attracting significant global interest from markets such as Indonesia to support their transition to renewable energy,” he says.
“Through meetings with our Indonesian counterparts, we are exploring opportunities to grow participation in global battery and critical mineral supply chains and further strengthen value-adding and manufacturing industries.”
Deals in motion
The roadshow also included the signing of a memorandum of understanding (MoU) between WA-based Future Battery Industries Cooperative Research Centre (FBICRC) and Indonesia’s National Battery Research Institute (NBRI). The agreement aims to strengthen collaboration in battery research, technology and innovation.
“Both Australia and Indonesia have great potential to accelerate the global energy transition. This collaboration with NBRI is a practical demonstration of turning intent into tangible action and we very much look forward to working together,” says Shannon O’Rourke, FBICRC CEO.
NBRI was established in 2020 by Founder, Professor Evvy Kartini, as an independent institute for electrochemical energy storage science and technology, supporting research, training, and education.
“I would like to express my appreciation to the West Australian Government and the FBICRC for this opportunity to learn from Australian experts and help Indonesia to become a global player in the battery market,” she says.
In February, an MoU was signed between WA and KADIN (Indonesian Chamber of Commerce) to support cooperation to develop a critical minerals supply chain and promote investment in the sector.
A Plan of Action was also signed by WA Premier Roger Cook and KADIN in July during Mr Widodo’s visit to Australia to promote future opportunities for collaboration.
Western Australia a prime destination for investment
WA’s renewable energy and critical minerals industries are still in their infancy, with dozens of projects across the State in development and primed for investment.
The two sectors are highlighted on WA Investments* – a dedicated website showcasing on the world stage investment-ready projects located across WA.
Mining and METS (mining equipment, technology and services) has the most projects listed compared to other industries.
“There are numerous projects that offer mutual benefit for WA and Indonesia,” says Golds.
“Showcasing more than $8b worth of projects, WA Investments is the most valuable showcase of investment-ready projects in Australia.
“WA is where Indonesian investors need to be looking for opportunities that will help the country and its industries transition to renewables and a sustainable future.”
*WA Investments is a collaboration between CCIWA and Invest and Trade WA.
If you are looking for opportunities in business, investment or trade, visit WA Investments.