Edition 23: Indonesia Aiming to Be Second Largest Lithium Battery Producer By 2028
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Indonesia Aiming to Be Second Largest Lithium Battery Producer By 2028
Source: Pexels
On Tuesday 25 October, Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan stated that Indonesia is expected to produce its own lithium batteries for electric vehicles (EVs) by the second quarter of 2024, and is aiming to be the second largest producer by 2028.
Indonesia is also on track to secure energy deals during the G20 summit in November in a bid to push renewable energy adoption to 40% in 2030. The deals also include private sector partners such as Tesla, which has secured a USD $5 billion deal to acquire nickel from Indonesia.
Production of lithium batteries will mainly be in the planned green industrial park in North Kalimantan. However, MIND ID Institutional Relations Director Dany Amrul Ichdan mentioned that around 20% of the raw materials for the batteries still need to be imported, including lithium hydroxide and graphite.
The government has been hammering EVs hard to Indonesian consumers, even granting EV subsidies starting next year purportedly to accelerate the transition from fossil fuels. The subsidies reportedly would be equivalent in amount to fossil fuel subsidies for 3–4 years.
However, Indonesia’s battery industry has been criticized by many as being environmentally damaging.
The mining of materials like nickel in Sulawesi has caused massive damage to ecosystems surrounding the big mines. Additionally, the government has not released any clear plan to tackle negative environmental impacts.
Not only that, the process itself leads to significantly higher emissions in the production of EVs than internal combustion cars. With the electric grid still mainly relying on fossil fuels, it may seem that the emissions transferred from the car itself to the power plants due to the need to charge EVs.
Many companies are also trying to look for undiscovered lithium deposits, with geologists doubting their survey efforts. This poses a serious dent in Indonesia’s aspiration to be more than just a commodity exporter in the growing EV battery production race.
Several high profile private investments into the EV industry have also been called out for being environmentally damaging, causing mass deforestation and water pollution.
While Indonesia’s bet to accelerate its transition from fossil fuels is admirable and the building of energy storage capacity will be key towards the transition to renewables, the level of environmental impact caused by the accelerated mining for rare earth minerals remains to be seen.
This bet is also not universally seen as the best way to reduce emissions, with some noting the importance of also focusing on public transportation instead of EVs. A focus on public transportation is slated by the World Bank to also be crucial to improving Indonesia’s competitiveness and reducing social inequality.
What Is Up, Indonesia?
🌎 Politics, Law & International Relations
Lower Octane Fuels Outlawed Next Year: The government will only allow the sale of gasoline with a minimum 90-octane classification (now only sold by Vivo Indonesia under Revvo 89 and Pertamina under Premium) starting from 2023 as the country shifts to cleaner fuels.
BPOM Rejects Liability for Syrup Medicines Causing Kidney Failures: The Food and Drug Monitoring Agency (BPOM) has deflected blame for the current cases of contaminated syrup medicine causing deaths among children and has redirected the blame to poor quality control at pharmaceutical companies.
ASEAN Fails to Implement Key Peace Plan for Myanmar: The Ministry of Foreign Affairs highlights the failure to implement the Three Points of Consensus (3PC) by the Myanmar Military Junta as the country plunges into a bloodier civil war.
📈 Economics, Business & Technology
SE Asia Internet Economy Forecast Cut Amidst Economic Headwinds: Southeast Asia's internet economy is expected to be worth $330 billion by 2025, a downgrade from a previous forecast due to economic uncertainty and more pressure on tech companies to make a profit.
Exports to Benefit Over High Commodity Prices: Indonesia's exports could hit a record $280 billion this year, with nickel-based steel shipments rising sharply after the country banned nickel ore exports, while shipments of other commodities got a boost from high prices.
🏛️ Society & Culture
Immigration Authority Introduces 10-Year "Second Home" Visa: The Immigration Directorate General has introduced a 10 year long-stay visa for foreigners with at least Rp 2 billion in their bank account, intended for former Indonesian citizens looking for an extended stay visa.
BEM UI Likened to an Anti-Government Organization: Faldo Maldini, former Indonesian Solidarity Party (PSI) candidate and Special Staff from the State Secretary, responded to criticism from the Student Union of the University of Indonesia by saying their online content is similar to anti-government social media accounts.
Woman Points Gun at Presidential Palace Security: Indonesian police arrested a woman allegedly linked to a banned Islamic organization who pointed a gun in an attempt to force her way inside the Presidential Palace.
What We're Reading
While the media usually portrays the deteriorating conditions of our world with environmental catastrophes and wars, it's easy to forget that we are now living in a better world when looking into the data.
In Fact, the World is Getting Better: “We need some balance in our news, but that doesn’t mean ignoring global warming: it is a real problem, caused by humanity. We just need perspective. Climate change fear is causing life-changing anxiety. You might be hearing nothing but bad news, but that doesn’t mean that you’re hearing the full story.” - Bjorn Lomborg, The Jakarta Post
WIUI Recommends
From Dreams to Dust (Documentary, Directed by Stephanie Tangkilisan and Muhammad Fadli)
This is an apt watch for a lot of you who care about the environment. Related to the whole EV industry push we are covering this week in our headline, this documentary follows a 36 year old truck driver who reminisces about his once-idyllic village, now transformed by the Sulawesi nickel mining industry. It is the winner of the 2022 Yale Environment 360 Film Contest.
~ Cult Leader Vincent
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Disclaimer: We are not professionals. We are prone to bias and error so please verify and double-check everything! We highly encourage you to do your own research.