Currently, developed countries such as those in the European Union (EU) have created the Carbon Border Adjustment Mechanism (CBAM).
Therefore, he said, goods from Indonesia will lose their competitiveness if not backed by energy transition.
According to Kaimuddin, the energy transition provides many potentials and benefits to the economic sector.
For instance, the environmental, social, and governance (ESG) concept emphasizes the urgent need for companies to practice sustainable programs.
"Sometimes, we think that ESG (implementation) is costly, but it actually can become an investment in the future. Perhaps, if a company does not apply ESG, (the costs incurred) will be more expensive," he said.
He emphasized that countries like Indonesia must be independent and resilient in the energy sector, and not merely depend on energy imported from abroad.
Although Indonesia still exports fossil energy, such as coal, and other non-renewable energy commodities, it must prepare for the energy transition to keep up with the times.
"We currently import 60 percent of our fuel oil to be used for transportation. This becomes a risk if we do not have strength in the country," Kaimuddin said.
Further, in using renewable energy, Indonesia must ensure to be included in the supply chain to minimize the imports of clean energy devices such as solar panels, he added.
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Translator: M Alatas, Kenzu
Editor: Rahmad Nasution
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