The Effects of Fossil Energy Consumption and Renewable Energy Investment on Indonesia’s Greenhouse Gas Emissions: An Analysis within the Green Economy Framework

Abstract

This study aims to the relationship between fossil energy consumption, renewable energy development, and greenhouse gas (GHG) emissions in Indonesia within the framework of a green econmy. The study employs a descriptive quantitative approach using secondary data from Statistics Indonesia (BPS) for the 2020–2024 period, covering the Energy Flow Accounts and GHG Emissions Accounts, along with supporting data from the Ministry of Environment and Forestry (KLHK), the Ministry of Energy and Mineral Resources (ESDM), and various related scientific literature. The results show that fossil energy consumption particularly coal continues to dominate Indonesia's energy input structure, reaching 96.89% of total natural energy inputs in 2024, while the renewable energy contribution actually declined from 3.51% (2020) to 3.11% (2024). Total GHG emissions increased from 820,375 GgCO₂e (2020) to 1,040,663 GgCO₂e (2024), with the Manufacturing and Electricity and Gas Supply sectors contributing 71.88% of emissions across all industries. The emission intensity of the Manufacturing sector increased by 41% during the study period, indicating that decoupling between economic growth and emissions has not yet occurred. Renewable energy development, as reflected by the renewable energy mix, showed a declining trend, from 7.20% in 2020 to 4.97% in 2024, which occurred alongside an approximately 6% increase in national GHG emission intensity. This study concludes that Indonesia’s continued dependence on fossil energy and the limited development of renewable energy occurred alongside increasing GHG emissions, indicating that the transition toward a green economy has not yet been optimal. This study recommends increased investment in renewable energy research and development, accelerated pro-renewable energy policies, and strengthening of an integrated green economy policy framework.