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By 2030 Indonesia aims to reduce its CO2 emissions by 29% while maintaining a 7% annual GDP growth rate, thus making “green economy” a reality. Based on a review of literature and secondary data and interviews with key informants, this article examines the gap between these national ambitions and the reality on the ground, with particular attention to the challenges of multi-scalar environmental governance. It first introduces the green economy concept and discusses the main green growth policies and initiatives at the national level. The article then examines green growth ambitions at the provincial level in East Kalimantan province. Our findings suggest that existing plans to further expand oil palm plantations are at odds with provincial efforts to reduce emissions. This highlights a key paradox we identify at the heart of the green economy concept as it is developing in Indonesia: between a development trajectory based on resource extraction and agro-industrial development, and ‘green’ aspirations linked to environmental protection and greenhouse gas emissions reductions. We conclude that the main challenges to address these contradictions are related to the lack of coordination between different governance scales and a political economy that is not conducive to reforms in the land-based sector. There is a need to align investment, planning, and green growth policies, based on a strong political commitment and an awareness of social and environmental trade-offs. On a more general level the article shows that the green economy concept refers to a form of environmental governance in which authorities and interests may overlap and come into conflict at different scales. Hence, differing priorities may lead the material expression of the green economy to diverge significantly from policy as it is initially laid out.