Risks and opportunities in early retirement of CFPP in Indonesia: An analysis of environmental, socio-economic and regulatory implications

Dzikrina Almas Kusumadewi; Yuki Mahardhito Adhitya Wardhana; Dwi Nowo Martonoc; Zulfahmi

doi:10.15294/ijel.v5i1.43255

Authors

Dzikrina Almas Kusumadewi Graduate School of Sustainable Development, University of Indonesia, Jakarta, Indonesia Author
Yuki Mahardhito Adhitya Wardhana Graduate School of Sustainable Development, University of Indonesia, Jakarta, Indonesia Author https://orcid.org/0009-0006-0810-0905
Dwi Nowo Martonoc Graduate School of Sustainable Development, University of Indonesia, Jakarta, Indonesia Author https://orcid.org/0000-0003-2362-9066
Zulfahmi Islamic Business School, Universiti Utara Malaysia, Malaysia Author https://orcid.org/0000-0001-5375-4496

DOI:

https://doi.org/10.15294/ijel.v5i1.43255

Abstract

This study aims to analyze Indonesia’s energy transition initiatives through the early retirement of Coal Fired Power Plants (CFPPs) to increase the contribution of renewable energy to national energy mix. The research identifies key challenges related to coal dependency, sustainable financing, socio economic risks associated with workforce displacement, and regional impacts. We use mixed methods to employ a bibliometric analysis using VOSviewer to map research trends on implementing early retirement CFPP and coal phase-out strategy. This approach to identify emerging thematic clusters and research gaps over the period 2015–2025. The results indicate substantial growth in publications on this topic up to 2020, followed by fluctuations in subsequent years, suggesting that considerable scope for further research in the field of energy transition. The Systematic Literature Review (SLR) complements these findings by examining theoretical and policy perspectives from both developed and developing countries. A comparative study was conducted on developed countries that have planned and successfully implemented coal phase-out policies. The analysis shows that successful coal retirement requires a comprehensive strategy policy framework, including environmental impact, legal and policy standing, financial and fiscal aspects, and regional support compensation. The gradual coal phase-out strategy offers Indonesia an opportunity to accelerate the early retirement of CFPPs, promote renewable energy development, reduce environmental impacts, and strengthen global climate commitments while addressing socio economic challenges. The findings highlight the urgency of adopting an integrated policy framework to guide Indonesia’s energy transition toward an environmentally sustainable, socially inclusive, and affordable energy system.

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