September 24, 2023

The transition from fossil fuels to renewable energy has become a hot topic in Indonesia in the past decade, with increasing awareness of the need to reduce negative environmental impacts. Union Aid Abroad-APHEDA is working with the Indonesian Trade Union Confederation (KSPI) and Confederation of Indonesian Prosperity Trade Union (KSBSI) as key parties in this process to ensure a just transition for workers and their communities.

Recently, the KSPI completed a study into the impact of the energy transition on workers in the mining sector, garment sector, and plantation and forestry sectors. Their findings are presented below.

Research by the Global Commission on the Economy and Climate found that the transition to renewable energy can provide significant economic opportunities, such as creating new jobs, increasing investment, and reducing energy costs.

However, this energy transition does not come without challenges, particularly in terms of its impact on employment. One of the big threats is the potential loss of jobs from the introduction of more sophisticated new technology and automation. The use of more efficient technology in production processes can replace human labour, bringing uncertainty and worry to workers.

The Indonesian Trade Union Confederation demonstrating against the anti-worker laws in 2022. Photos: KSPI/Facebook.

In facing this challenge, the role of the KSPI is very important. With 500,000 members across Indonesia, they can play a central role in fighting for workers’ rights during the energy transition process. Green jobs must provide a decent income, adequate benefits such as health benefits and pension benefits, and the protection of fair work rights such as the right to join a union and bargain.

A key objective of the KSPI is to guarantee decent work and trade union rights in the renewable energy sector. As part of the Just Transition process, they are also working to ensure that trade unions are included in the decision-making process and to consolidate workers’ rights for jobs in both the formal and informal economies in the existing energy sector.

Many companies in Indonesia, including in the mining sector, the garment sector, and the plantation and forestry sectors, have taken steps to implement energy transition policies to achieve sustainability and contribute to global efforts in dealing with climate change. However, worker’s rights need to be secured and unions have been organising towards key objectives for a just transition.

Ensuring job security in the mining industry

The mining industry in Indonesia is an important and strategic economic sector. Indonesia has abundant natural resources, including various types of minerals, coal, oil, and natural gas, These need to be urgently phased out in light of the climate crisis.. The mining industry employs 1.53 million people and is one of the main contributors to the Indonesian economy. The Indonesian government has committed to reduce emissions to 31.89% by 2030 and achieve net zero by 2060.

For workers in this sector however, wages are low and short-term work contracts are often used to deal with fluctuations in production or the needs of certain projects.

The energy transition involves changes in energy production methods and technologies. The KSPI study has found that with increased knowledge and skills, miners can learn and master new technologies needed in the renewable energy industry. Additionally, it also found that they can contribute to the development of renewable energy projects, such as the installation of solar panels, wind turbines or the use of other renewable energy technologies.

70% of workers fear losing their jobs in the next few years due to the energy transition and the use of new technologies. Trade unions are critical in advocating for workers’ rights, ensuring fair working conditions, and fighting for decent wages and job security.

Green technology in the garment industry

Garment companies need to improve energy efficiency in their entire production chain.

The garment industry is widely recognised as one of the sectors with significant environmental impacts. The garment industry has traditionally used hazardous chemicals, released untreated waste water, and produced greenhouse gas emissions.

Various studies have also shown that the working environment in the garment industry has become a major concern because of its impact on the health and welfare of workers. They are subjected to harsh working conditions, such as long working hours, low wages, job insecurity, and high pressure to meet production targets. They are consequently at risk of workplace accidents and ill health brought about by  exposure to hazardous chemicals and excessive workload.

Demands to improve the work environment in the garment industry are getting stronger. Garment companies need to improve energy efficiency in their entire production chain. This can be achieved by adopting more efficient technologies and systems, such as the use of energy efficient machines and equipment, the use of LED lights, and sophisticated energy management systems.

The concept of green technology in the garment industry involves  the implementation of key changes, including the use of environmentally friendly raw materials, energy efficiency, reduction of carbon emissions, and good waste management. The application of green technology helps reduce water, air and soil pollution caused , as well as reduce greenhouse gas emissions that contribute to climate change.

Sustainable agriculture in the plantation industry

Aerial view of a palm oil plantation in Indonesian Borneo.

Indonesia is home to some of the biggest plantation industries in the world, one of which is palm oil production.  Oil palm plantations supply the food, cosmetic and biofuel industries. Indonesia and Malaysia are the two largest producers of palm oil in the world.

In recent years, there has been an increasing focus on the sustainability and environmental impact of the plantation industry. Efforts are being made to promote sustainable agricultural practices, protection of the environment, and fair working conditions.

Farm workers and plantation workers often live around plantations. They generally come from remote and poor areas. They often have low levels of education and depend on plantation work as their main source of income. They work in hot weather, under substandard workplace safety standards. They face the risk of workplace accidents, diseases related to pesticide exposure, or physical injury. They usually get a daily wage which is insufficient to meet their basic daily needs.

Workers in the plantation industry sector are faced with the risk of termination of employment and job changes as part of the ongoing energy transition. Data from the Central Bureau of Statistics shows that Indonesia’s plantation sector has experienced a 5% decline in employment in the past five years, largely due to automation and energy transition. For example, the use of renewable energy may result in reduced demand for certain plantation products, such as palm oil for biodiesel.

The trade union covering workers in this sector is monitoring the implementation of the energy transition policy in the companies. This will ensure that agreed commitments are honoured and workers’ rights are protected. They are also promoting training and skills development so that workers have a better chance of adapting to change and continue to be able to earn a living.

Preparing for change

This research proposes several recommendations for trade unions and companies. Firstly, workers must be empowered in the process of innovation.. The introduction of new technology should not only be seen as a threat, but also as an opportunity to improve efficiency and quality of work.

Secondly, it is important for unions and companies to build awareness about the importance of the energy transition and its implications for workers. Education and training on energy change, technology and sustainability can help workers understand and prepare for the transition. This education can also open up opportunities for workers to participate in innovation and prepare them for a more diverse future of work.

Thirdly, trade unions,  must be actively involved in formulating energy transition policies. This engagement should include the planning, implementing and monitoring of the impact of the policy. The KSPI believes that when unions and management work together on plans, it will lead to better decision-making and more inclusive policies.

Fourth, companies need to develop a comprehensive employment transition plan to ensure workers have access to skills training appropriate to the needs of the future labour market. This plan should include training programs, career development opportunities, and reassignment assistance for workers affected by technological change.



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