Over the past decade, the production of electric vehicles has increased rapidly due to high demand and falling prices. This shows how the market is steadily transitioning to a greener path. However, behind this transition lies a significant trade-off that must be borne. One of the most essential elements in electric vehicle battery production is nickel, and its skyrocketing demand has caused very severe impacts on the environment of the mining areas,  just like many large-scale extractive industries.

Since the enactment of Law No. 4 of 2009 concerning Minerals and Coal, Indonesia has become increasingly very ambitious in positioning itself as the world’s top nickel producer. The law  propelled the issuance of hundreds of mining permits. As at 2021, 292 mining business permits had been issued and the industry does not seem to be slowing down. (Naryono, 2023). In 2023 alone, Indonesia produced about 1.8 million metric tons of nickel, providing around 50 percent of the world’s demand. And this number is expected to keep increasing, supported by Indonesia’s immense resources and reserves of nickel, which amount to 140.3 million tons and 49.26 million tons, respectively (Ahdiat, 2024). However, the booming industry comes at a very steep environmental price, particularly in the regions where the extraction is highly concentrated.

Southeast Sulawesi stands as the most affected region. It is  the largest nickel-producing province in Indonesia, with a total mining area reaching almost 200,000 hectares (Salim, 2024). Despite its rich mineral reserves, the province's communities are traditionally very reliant on the ocean. Being a coastal region composed of many islands, its people, especially the indigenous Bajau tribe have depended on the sea for generations.

Among the worst hit areas in Southeast Sulawesi is Kabaena, a small island located on the southwestern coast of the province. Despite its small size, 75% of the land area on this island has been covered by mining permits (Satya Bumi, 2024). The once clear waters that surrounded the island have now assumed a reddish-brown color due to the direct consequence of sedimentation from nickel tailings. These wastes containing heavy metals are contaminating the marine ecosystem and causing a drastic loss in biodiversity. The fish population has plummeted, and the economic impact on coastal communities especially on the Bajau people is very devastating. According to a report by Satya Bumi, 2025, the fishers' catches have reduced by over 50 percent, forcing them to sail as far as 20 miles offshore in order to find fish.  This does not only endanger their livelihoods, but it also jeopardizes the overall socio-economic life of a community that has been historically connected to the ocean.

The environmental impact also extends to public health. Contaminated seawater can cause skin allergies when someone gets into contact with it as well as develop long-term health effects due to consumption of tainted seafood, in particular shellfish. Tragically, children, often aged less than five years old,  have drowned in waters filled with mining waste. Traditionally, Bajau children are taught to dive as early as the age of three, but due to deteriorating conditions of the waters, parents now prohibit swimming entirely. This is not only a health and safety hazard but also a disruption of Bajau customs, and their identity as seafaring community.

At the heart of the crisis lies a very poor environmental management by mining companies. Ideally, tailings and other wastes in mining ought to be properly treated and disposed of. Nonetheless, there are widespread indications that wastes are being directed directly into rivers, eventually reaching the sea. This indication is reinforced by findings by Satya Bumi, which state that the concentration of cadmium around Kabaena Island is alarmingly increasing (Satya Bumi, 2024), which is most likely caused by mining activities and the discharge of toxic metals into the marine environment. The issue of corruption also compounds this issue; in 2016 the former Governor of Southeast Sulawesi was implicated in a corruption case involving the issuance of mining licences and sentenced to 12 years in prison in 2018. These types of cases undermine legal enforcement and environmental standards. Illegal mining, which is also very widespread as a result of minimal oversight, adds another layer of complexity to the problem.

In order to address this escalating crisis, the government must take very immediate and decisive action at both national and regional levels. Regulatory oversight should be greatly enhanced through routine independent auditing of environment impact assessment. Mining companies that have been found in contravention of environmental standards must face serious consequences such as license revocation and legal case prosecution. Investigations and crackdowns on illegal mining, which are often the most reckless when it comes to environmental and safety practices, must also be given a very high priority. Beyond enforcement, corporate accountability in restoring destroyed ecosystems, and offering health, psychological and financial assistance to the communities affected should also be undertaken.

In addition, long-term policy measures should be explored. The government could introduce performance-based tax incentives for mining companies that genuinely comply with environment laws and standards, engage in sustainable activities, and also participate in the local development of the mining communities. Importantly Law No. 1 of 2014 on Coastal and Small Islands Management, clearly states that small islands under 2,000 km², such as Kabaena, should not be exploited. This legal provision should prompt a very comprehensive cost-benefit analysis to determine whether mining on Kabaena should be discontinued entirely or be permitted only under strict restrictions. Without a very firm and decisive action, Indonesia’s electric vehicle ambitions may come at the irreversible cost of sacrificing its own blue paradise and the communities that have depended on it for generations.