In Jakarta, Adaro Energy Indonesia (ADRO), traditionally a coal-centered enterprise, is taking bold steps towards becoming a sustainable energy supplier. By dedicating half of its 2024 capital expenditure budget, which is between $600-700 million, specifically $300 million (approximately Rp 4.78 trillion), ADRO is gearing up to dive into the renewable energy sector.
The company’s President Director, Garibaldi Thohir, underscored the shift away from expanding coal mines to focusing on enhancing productivity at existing sites. This change signifies Adaro’s initial move towards embracing sustainability. “We’re putting our current resources to their best use,” he stated during a presentation on a Wednesday.
Garibaldi, also known as “Boy Thohir,” showcased the company’s determination for this green shift. “Adaro isn’t just dipping its toes into green energy; we’re committed to exploring various sustainable energy forms, including future endeavors into carbon capture technology,” he emphasized.
While acknowledging that transitioning to renewable energy is a gradual process, Garibaldi is optimistic about the growing demand for cleaner energy, both domestically and on a global scale. He pointed out the increasing need for electric vehicles (EVs) as a significant driver, especially concerning the demand for aluminum, which is crucial for producing lighter, more efficient EVs. This requirement is to be met by Adaro’s subsidiary, a producer of green aluminum.
“The lighter the car, the better it operates, especially for electric vehicles that carry heavy batteries. By providing lightweight aluminum, we’re catering to both the local and foreign markets,” Garibaldi elaborated.
Further pointing towards the company’s renewable ambitions, Director of Adaro Energy Indonesia, Christian, shared plans for a hydroelectric power plant in Mentarang Induk, North Kalimantan. Expected to achieve a capacity of up to 1.3 gigawatts (GW) by 2030, this project marks an essential step towards supplying power for green aluminum production.
Following these announcements, Adaro’s shares experienced a positive bump, increasing by 1.4 percent in early trading on Thursday. This strategic shift reflects Adaro Energy’s commitment to contributing to a more sustainable future, signifying a critical transition for Indonesia’s commodities sector towards green energy.