An event co-hosted by Climateworks Centre in Jakarta explored the opportunities presented by place-based decarbonisation in Indonesia.

Last month’s event, held in collaboration with the Indonesian Ministry of Industry, presented the concept of net zero industrial precincts (NZIPs) to representatives of government agencies, industry leaders, technology providers and investors and outlined Climateworks’ latest findings on their potential.

NZIPs take a coordinated approach to accelerating industrial and energy transitions. 

They work by clustering industrial and renewable energy assets together in a single precinct, with the added benefit of aggregating demand and streamlining investments.

Since May 2024, Climateworks has been working with the Ministry of Industry’s Directorate of Industrial Territories to explore how NZIPs can decarbonise the country’s industrial area while boosting its competitiveness in a global low-carbon market. 

NZIP approach complements Indonesia’s industrial decarbonisation landscape

The event began with keynote speeches from Anna Skarbek, CEO of Climateworks, and Dr Winardi, Director of Industrial Region, Ministry of Industry. 

Ms Skarbek highlighted the global trend of these clusters, hubs and precincts accelerating industrial decarbonisation [PDF 0.3mb]. 

Climateworks’ NZIP initiative is designed to leverage these opportunities, fostering more equitable, ambitious and practical transition planning, she said.

‘A place-based, collaborative approach provides tailored solutions that address location-based industrial decarbonisation challenges,’ Ms Skarbek said.

Dr Winardi underscored the significance of Indonesia’s industrial zones as engines of economic growth and competitiveness, while acknowledging that rapid industrial expansion has led to rising emissions due to reliance on fossil fuels. 

He expressed the Ministry’s support for Climateworks’ NZIP initiative as a key pathway to transforming Indonesia’s industrial zones into low-carbon, sustainable hubs, aligning with the nation’s commitment to net zero emissions by 2060.

‘With the support, cooperation and commitment of many stakeholders, the steps towards a green, sustainable and environmentally sound industrial estates are increasingly real,’ Dr Winardi said.

Climateworks has identified the ten places in Indonesia best suited to an NZIP approach

Jannata (Egi) Giwangkara, Program Impact Manager for Climateworks’ Indonesian energy and industry work, provided updates on the NZIP program’s progress [PDF 2mb].

In its first phase, Climateworks, with advice and input from the Ministry of Industry, conducted a rigorous assessment of 139 industrial estates and 31,000 single-actor sites to identify locations with the highest potential for NZIP-driven decarbonisation.

From these, Climateworks’ team shortlisted ten candidate precincts, of which five will be selected through further stakeholder engagement in the coming months.

The program’s second phase is now underway and will focus on developing decarbonisation roadmaps and transition plans for these precincts. 

In the third phase, Climateworks will support the Ministry of Industry in integrating the NZIP framework into national policy, contributing to Indonesia’s industrial decarbonisation goals and targets.

Panel reveals high interest in NZIP framework from Indonesia’s industrial sector

The presentation was followed by a panel discussion featuring key representatives from the government, industry and technology sectors, reflecting strong interest in the NZIP framework as a tool for industrial decarbonisation.

Esti Pangestuti, from the Directorate of Industrial Region at the Ministry of Industry, emphasised that the NZIP initiative aligns with Government Regulation 20/2024 on eco-industrial parks [PDF 3mb]. 

She said the Ministry is currently developing indicators to guide the implementation of these parks, with the NZIP framework expected to contribute to this process.

‘The NZIP concept allows industrial estates to identify strategies that best suit the characteristics and needs of each region,’ Pangestuti said.

Saifuddin Suaib, Business Development Manager at HDF Energy, stressed that economic and financial feasibility is crucial for the success of climate and energy projects. 

He said green hydrogen power [PDF 0.9mb] and other clean energy solutions must be both cost-competitive and bankable for industrial adoption.

‘Industrial precincts in eastern Indonesia represent a major opportunity, as many companies still rely on expensive and carbon-intensive diesel,’ Suaib said. 

The NZIP framework’s place-based approach could help tailor solutions that work for the local area, making decarbonisation efforts more viable, he said.

From the industrial sector, Sheren Omega, Head of Sustainability at Gunung Raja Paksi, noted that decarbonisation is increasingly seen as a business survival strategy rather than just a compliance requirement [PDF 2mb].

‘Customers and financiers – both local and international – are paying close attention to sustainability standards when making investment and procurement decisions,’ Omega said. 

The NZIP initiative could encourage the government to provide more support in creating conditions favourable to reducing industry carbon emissions.

Regi R. Sandi, Infrastructure Sustainability Manager at Jababeka Infrastruktur, spoke of the unique challenges industrial estate managers face [PDF 15mb]. 

Despite these challenges, Jababeka is supporting the tenants through its Net Zero Industrial Cluster Community initiative.

‘On one hand, we need to encourage tenants to adopt decarbonisation measures. On the other, we must also consider their financial constraints,’ Sandi said. 

He highlighted the need for collaborative roadmaps with clear sector-specific targets, which he said will help industrial estates effectively communicate and implement their sustainability commitments.

Looking ahead: What to expect from NZIP Indonesia

This first Indonesia NZIP event showcased the growing momentum around industrial decarbonisation from government, industry and technology players. 

Climateworks’ NZIP framework is emerging as a crucial tool to facilitate this transition, offering a structured, place-based approach to decarbonisation that considers economic feasibility, regulatory alignment and industry needs.

With strong stakeholder engagement and the next phase of the program underway, Indonesia’s journey toward net zero industrial precincts is gaining traction, positioning the country as a leader in sustainable industrial transformation.