Low carbon growth in Indonesia

Abstract

Indonesia has responded to worldwide concern about climate change by committing to significant carbon emissions reductions over the next decade. Achievement of this goal will face significant practical obstacles, and the opportunity cost of avoided deforestation is considerable. In our second Policy Dialogue, two climate change experts present contributions to the debate. This exchange could not be more timely, given Norway's recent offer of substantial development assistance to Indonesia in return for reductions in deforestation and forest degradation.

In this first contribution, Adam Schwarz canvasses abatement options and outlines barriers to abatement and its measurement. These include capacity and data constraints, obstacles posed by decentralisation, and problems in identifying and measuring the costs of abatement measures. The author urges Indonesia to embrace the opportunity a lower carbon growth trajectory presents, and argues that this will require substantial additional funding, including from developed countries, and sustained leadership. (Ed.)

Notes

¹‘REDD’ stands for ‘reduced emissions from deforestation and forest degradation’. ‘REDD + ’ includes additional elements such as sustainable forestry management, reforestation and afforestation.

²For further information, see Baer et al. (2010) and Albani et al. (2010), white papers published by McKinsey & Company's Climate Change Special Initiative, Jakarta.

³These estimates do not include transaction costs, which for some abatement initiatives could be significant; for more information, see National Council on Climate Change (forthcoming).

Additional information

Notes on contributors

Adam Schwarz

Adam Schwarz is a senior adviser to McKinsey & Company