Indonesia’s Green Growth Program Phase 2 (GGP2, 2016-2020) ended at the end of 2020. What milestones were successfully realized together through the collaboration between the Government of Indonesia and GGGI?

Under the collaborative framework of the Indonesia Green Growth Program Phase 2 (GGP2, 2016-2020), GGGI supported the Government of Indonesia to accelerate the pace of investment in inclusive green projects with the aim of helping the GoI meet its international commitments, including the Nationally Determined Contribution (NDC) and Sustainable Development Goals (SDGs), as well as increasing the capacity of civil servants in realizing the nation’s vision towards a sustainable and climate-resilient Indonesia by enacting appropriate policies.

GGP2 aimed at mobilizing large-scale financing and generating high-impact green growth with a focus on developing socially inclusive climate-related investment projects, as well as enhancing partnerships and capacities to replicate and enhance green growth in line with the Government’s development agenda for economic growth, poverty reduction, job creation, and environmental sustainability.

GGGI delivered its technical assistance, focusing on three priority areas:

1. Renewable Energy
2. Special Economic Zones (SEZ)
3. Forests and Land Use

Some of the highlights of GGP Phase 2 include GGGI’s support for Indonesia’s Low Carbon Development Initiative (LCDI), forestry and energy background studies for Indonesia’s Medium Term Development Plan (RPJMN 2020-2024), the NDC roadmap, leadership training for government officials, capacity enhancement of the Forest Management Units (FMUs), project studies for PT SMI, and development of project proposals for the Green Climate Fund (GCF) and other investors.

All in all, GGGI helped prepare more than 50 policies, plans and regulations and assisted in mobilizing funding commitments up to USD 500 million, including USD 213.8 million through results-based payments from the FCPF-Carbon Fund and the GCF, as well as the development of projects currently in the pipeline valued at USD 300 million. These projects will be continued in GGP Phase 3.

Further milestones of GGP Phase 2 include:

1. Capacity Building Program through the National Institute of Public Administration (NIPA):

• Launch of Green Growth Training (Pro Green) in 2019.
• 15 training modules have been developed for 20 training and knowledge sharing sessions that reached 3,000 participants.

2. Sustainable Landscapes with the Ministry of Environment and Forestry (MoEF):

• Assisted 53 FMUs in developing business and forest management plans.
• Development of the Peat Ecosystem Protection and Management Plan (RPPEG) for the Provinces of East Kalimantan and Central Kalimantan.

3. Mobilized a total of USD 500 million in Green Investments:

• USD 110 million from the FCPF-Carbon Fund for emissions reduction from forest and land use in Kalimantan.
• USD 103.8 million from GCF for Reducing Emissions from Deforestation and Forest Degradation Results-Based Payment (REDD+ RBP).
• USD 60 million investment from the BioCarbon Fund for the Sustainable Landscapes REDD+ RBP program in Jambi Province.
• USD 10 million for private sector funding mobilization in partnership with the Tropical Landscapes Finance Facility (TLFF).
• Potential renewable energy development funds amounting to USD 6 million is ensured through Power Purchase Agreement (PPA) for Regional Owned Enterprises (BUMD) to develop solar power plants.

GGGI’s contribution throughout GGP2 have resulted in the significant increase in Indonesia’s green project pipeline with notable improvements in the quality of proposed projects and the capacity of key agencies, such as PT SMI as an investment channel and the National Designated Authority (NDA) for GCF in the Ministry of Finance.

Expanding green investment opportunities by designing bankable projects and creating an enabling environment through better policy development and planning are crucial to increasing Indonesia’s access to climate finance and private capital, which is important for Indonesia’s development efforts and climate commitments.

Read the comprehensive GGP2 report here.