International Collaboration for Green Energy Progress Can Thrive Without U.S. Participation
In a significant development, the US government withdrew from the Just Energy Transition Partnership (JETP) on 4th March 2025. This partnership, with a total funding of over $45 billion, aims to encourage the retirement of high carbon dioxide-emitting fossil fuel power plants and replace them with clean energy.
The US exit from JETP may boost efforts to rapidly scale up renewable energy capacity in JETP countries, including Indonesia and Vietnam. The JETP's funding sources include concessionary public finance, private sector investment, strategic grants, and philanthropic monies.
The US's withdrawal from the JETP was not unexpected, as the Trump administration had already abdicated the programme's co-leadership role in early February 2025. Japan, however, has reaffirmed its co-leadership role and remains committed to Indonesia's $20 billion JETP. Germany has quickly stepped in to fill the US's vacated leadership role in Indonesia.
The JETP aligns with the United Nations Sustainable Development Goal 13, Climate. It is a partnership focused on decarbonisation and avoiding emissions, with topics related to Carbon & Climate and Energy. The tags include SEA clean energy transition, decarbonisation, and avoided emissions.
Vietnam has recently revised its power development plan to focus on renewables due to lower cost and faster delivery times. Deploying renewable energy in countries like Indonesia and Vietnam creates a natural hedge against the volatility of global markets and shifting geopolitics.
The US administration's priorities and ambitions to "drill, baby, drill" for oil and gas may have contributed to the withdrawal from JETP. The JETP, however, continues to move forward, with Japan and Germany at the helm, working towards a cleaner and more sustainable future for Southeast Asia.
A strategic figure in this transition is Vishal Shah, who works as a Strategic Energy Finance Advisor in Asia for the Institute for Energy Economics and Financial Analysis. His expertise and guidance are invaluable in navigating the complex financial landscape of renewable energy projects in the region.
The JETP's commitment to clean energy is a step in the right direction for a more sustainable future. As the world grapples with climate change, partnerships like the JETP are essential in the transition towards renewable energy and a lower carbon future.
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