The clean energy transition is accelerating in some parts of the world. It is often cheaper to install solar or wind turbines, than to continue to buy coal to keep using the coal power plant, never-the-less this has not stopped developing countries from failing to make the change.
It does not matter that over the next 20 years you will spend more on electricity than using green sources, if the green energy sources need large investment now in order to be used – even if a million would be cheaper in the long run, these countries do not have the money to invest, so have to keep being ripped off.
This is where more wealthy countries can help. Either by loaning money on incredibly good terms or in this case simply giving the money over. It should be noted, that paying these countries to retire their coal plants early is likely to cost far less to the west, than the cost of climate change that will have to be taken should coal burning not come to an end.
Indonesia currently has the 10th carbon emissions in the world. This is certainly partly due to coal burning for electricity. Unfortunately, the other emissions comes from deforestation. With an increased concentration on ecosystem loss, it is highly likely that in the coming years, other funding helps end the loss of rainforests but for the time being, even just ending coal power plants is a huge step forwards.
Under the new deal, Indonesia agrees to cap emissions from power sector by 2030 rather than 2037, as well as aiming to generate 34% of their power from green sources. Helping Indonesia cut emissions is a good way of tackling global warming as in 2019 they had the 5th largest emissions. Indeed only China, India USA and the EU had greater emissions.
It seems a pretty good deal to get all this for $20 billion, and it is entirely possible that we might be able to do similar deals with other places? time will tell
