“Future transportation must be supported by a sustainable industry. Our nickel must be the backbone of the green energy transition, not just a short-term export commodity,” deputy chair of Kadin’s mineral and coal downstreaming committee, Djoko Widayatno, said here on Saturday.
Currently, Indonesia is starting to build an integrated EV battery industry ecosystem, covering precursor production to battery cell assembly and electric vehicles.
Large projects such as the construction of battery factories in Karawang and Morowali are believed to be a manifestation of the government’s commitment to creating a competitive supply chain to cater to the global market.
If successfully accelerated, the development of the ecosystem is projected to produce much greater added value.
In China, which has been developing its EV supply chain over the last decade, the contribution of the EV and battery industry crossed US$150 billion in 2023. The industry helped make the country a major exporter of electric vehicles globally.
According to Widayatno, Indonesia must learn from China’s success in developing the EV battery industry as proof of the great economic potential of further downstreaming.
Currently, China controls around 60 percent of global EV production and 80 percent of the world’s battery market. It is also the largest center of technology and supply chain for electric vehicles globally.
“To that end, we encourage the government to strengthen environmental governance, expand local HR training, and encourage technology transfer so the downstreaming of the nickel industry provides maximum benefits for Indonesia,” Widayatno said.
He also called for the use of clean technology, such as High-Pressure Acid Leach (HPAL), as well as the implementation of Environment, Social, and Governance (ESG) standards across the supply chain.
He emphasized the importance of directing high-grade nickel for EV battery products, not just stainless steel, to maximize nickel’s potential in the energy transition and support the 2060 Net Zero Emissions (NZE) target.
“Indonesia has made strategic achievements in nickel downstreaming. However, for this process to be truly sustainable and inclusive, it needs to be strengthened with good governance and the development of a comprehensive industrial ecosystem,” he added.
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Translator: Putu Indah Savitri, Yashinta Difa
Editor: Azis Kurmala
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