Overview of Government of Indonesia – GGGI Green Growth Program

Overview of Government of Indonesia – GGGI Green Growth Program

OECD-MINISTRY OF FINANCE INDONESIA ALIGNING POLICIES FOR THE TRANSITION TO A LOW-CARBON ECONOMY: Reconciling Environmental, Social and Economic Objectives November 4-5, 2015 // Novotel Bogor, Indonesia

Thailand

Cambodia

Vietnam

Mekong

Philippines

Indonesia

Pacific Islands

Country Sector/Programs

CambodiaGreen Growth Planning

Green urban development program

Indonesia

Green Growth PlanningGreen Growth Roadmap

Green growth assessment tools

Pacific Islands

Green Growth PlanningIntegrating Green Growth

Fiji: Framework into Planning and Budget Plans

Vanuatu: Green and inclusive energy reform

Philippines

Green Growth Planning; Adaptation

Climate resilient growth planning: Ecotown

Framework

ThailandMitigation

Climate Change Master Plan focusing on key industrial

sectors

VietnamGreen Growth Planning

Green urban developmentWater resource management

in Mekong Delta

Projects in Southeast Asia and the Pacific

3

Indonesia: Overview of GoI-GGGI Green Growth Program Phase 1 (2012-2015)

Country-level goal Component-level activities

“To promote Green Growth in Indonesia that recognizes the

value of natural capital, improves resilience,

builds local economies and is inclusive and

equitable.”

Green Growth Program

1Greening the

planning process

2REDD+ for

green growth

3Sub-national engagement

• 1A: National ‘Green Growth Roadmap’• 1B: Green growth assessment tools• 1C: Prioritization of green technologies

• National REDD+ support• Sub-national REDD+ support

• Green growth mainstreamed in Central and East Kalimantan

4 Government of Indonesia - GGGI Green Growth ProgramGGP Component 1A

Assessing and designing for green investment: GGAP

Mainstreaming green growth in policy, planning, and investment

• The Green Growth Assessment Process (GGAP) is an overarching process that applies good practice use of tools for achieving green growth project outcomes.


The roadmap is a high-level, evidence-based guide to planning and implementing green growth in Indonesia

Part 1 builds the case for moving to a growth trajectory that is more resource and energy efficient, environmentally friendly, and socially equitable.

Part 2 presents the various opportunities for green growth as well as current projects and initiatives in key economic sectors.

Part 3 describes the overarching policy and planning processes and presents methods, tools, and indicators to measure and monitor green growth performance.

Part 4 brings the preceding together into an action plan to deliver green growth in Indonesia in the short, medium and longer term, to 2050.

Mainstreaming Green Growth at Macro Level: The Green Growth Roadmap


Assessing and designing for green investment: extended Cost-Benefit Analysis

Mainstreaming green growth in policy, planning, and investment at project level

$

Baseline

Green Growth Scenario

Incremental benefits



Project is green, but there are opportunities to enhance the green growth performance further.

Project is not green, but re-design of the project in line with green growth assessment will make it greener.

Project is not green, and while re-design will reduce the negative impact of project, it may require a major re-think in order to meet minimum standards.

• Extended Cost-Benefit Analyses quantitatively weigh up the relative costs and benefits of a potential decision • This helps to capture the full impacts of policies and investments from an economic, social and environmental

perspective, including the benefits of avoided damages• They can be powerful tools with which to suggest alternative options (e.g. green growth) to the current

situation

* The horizontal line represents the minimum threshold at which a project can be considered to be contributing to a green economy.

7

• Series of four extended Cost Benefit Analysis (eCBA)

Technical report Model Policy summary booklet Training and validation workshops

Identified monetary benefits of proposed policy interventions:

KEK Maloy – 3.8 billion USD KSN Mamminasata – 355 million USD ERC Katingan – 9.9 billion USD

Mainstreaming green growth in policy, planning, and investment at project level

• Application of extended Cost Benefit Analisis (eCBA) to identify better green growth outcomes in four infrastructure and forestry/land-use projects

• Calculation of monetary values of benefits and costs associated with business as usual and green growth scenarios • eCBA goes beyond narrow financial considerations and includes wider social and environmental benefits and costs • eCBA is a useful planning tool to assess green growth outcomes of infrastructure projects at early stage (can complement

EIA and CBA in PPP projects)

Green Growth Assessment of Capital Projects

eCBA Studies Benefits (NPV) Policy barriers and enablers : examples

Regulatory issues Fiscal and financial incentives

KIPI MaloyNatural resource processing industriesInfrastructure: energy, road, transport, port

USD 3.8 Billion or 10% of regional GDP

Reform of energy pricing system and feed in tariffClarification of palm oil certification process and legal status

Support adequate feed in tariff for renewable energy (biomass) Tax exemptions for renewable energy capital equipment

KSN MamminasataFisheryReforestation / Clean Water Waste Management Renewable Energy

USD 355 Million or 6% of regional GDP

Clearer regulation on waste managementMatching spatial and land use plans

Ecosystem services levies Subsidy for waste reductionTax relief for investment in waste to energy equipment Financial support for local fish meal industry

ERC Project Katingan Ecosytem Restoration and Conservation

USD 9.9 Billion Streamlining and improving transparency of ERC licensing Clear spatial plan under One Map Initiative

Support of stable national carbon price Fiscal incentives for local governments to support ERC

Renewable Energy Options in Kalimantan Assessing 4 individual RE projects

USD 1-9 billion or 3-16% of regional GDP ( benefits of projects scaled up to Kalimantan corridor)

Transparency in grid expansion plansReform of energy pricing system and feed in tariff

Debt guarantees and capital grants to renewable energy developers Capacity building for project design expertise

G8GP Component 1A8


Monitoring and measuring green growth performance

Indicators to measure government policies, measures and opportunities (e.g. taxes, subsidies and regulations)

Indicators to measure the

environmental quality of life (e.g. air

quality)

Sustainable development pillar

Economic Social Environmental

Normative green growth outcome

Sustained Economic Growth Equitable and Inclusive Growth

Healthy Natural Capital Providing Ecosystem Services

GHG reduction

Stock

GDP (PPP) Gross capital formation FDI Working population R Debt

Poverty headcount R Population R Population living in land

area where elevation is below 5 meters

Forested area GEF index for biodiversity Mammal species threatened Marine protected areas Fish species threatened Healthy coral reef area Fish stocks R Primary energy reserves

Forested area GHGs

Flow

GDP growth (% yoy) Total factor productivity

(% growth) Formal employment Informal employment Unemployment Underemployment

HDI R Gini coefficient R Access to electricity R Access to public health

clinics R Access to internet

Fishery production R Deforestation rate R Primary energy consumption R Water stress index R Freshwater withdrawals

R Deforestation rate

1 2 3 4Key: Correspondence with

OECD conceptual measurement framework

This “dashboard” of macro and micro indicators can measure progress against different green growth outcomes. This reflects the complexities of measuring green growth.

The same set of indicators should filter down from national to a regional and district level in order that information can be aggregated.

Potential Areas of Collaboration

10

Phase II Design (2016-2019)

Program structure agreed with BAPPENAS

Overview of Government of Indonesia – GGGI Green Growth Program

Environment

Transcript of Overview of Government of Indonesia – GGGI Green Growth Program