In response to the challenges posed by climate change and to promote sustainable economic growth, the Indonesian government today officially announced a comprehensive plan aimed at advancing clean energy, with a particular focus on the solar industry. This plan not only marks a critical step in transforming the nation’s energy structure but also lays a solid foundation for achieving Indonesia’s carbon neutrality goal by 2040.
Indonesia is endowed with abundant solar resources, yet its current energy mix is still heavily reliant on fossil fuels. To address this situation, the government has devised a clear roadmap for clean energy development, aiming to accelerate the adoption and application of solar technology and increase the share of clean energy in the national energy supply.
The plan unveiled today outlines short-term, mid-term, and long-term goals:
- Short-term goals (2024-2029): Over the next five years, the government aims to add 15 GW of new solar power capacity annually and establish at least 15 solar industry clusters across the country.
- Mid-term goals (by 2050): Achieve a national installed solar capacity of 80 GW and fully transition the grid in certain regions to renewable energy.
- Long-term goals (by 2060): Ensure that solar power accounts for more than 50% of the country’s total electricity generation, supporting the achievement of the national carbon neutrality target.
To ensure the successful realization of these goals, the government will adopt the following key strategies:
- Policy and Regulatory Support: Focus on implementing and advancing the New Energy Law (Undang-Undang, RUU) and Renewable Energy (Energi Baru dan Energi Terbarukan, EBET), providing tax incentives, financial subsidies, and renewable energy procurement standards.
- Technological Research and Innovation: Establish a National Solar Technology Research Center to promote local manufacturing and encourage international technological cooperation.
- Economic Incentives: Implement a solar electricity tariff subsidy policy, promote green financing, and provide direct subsidies for solar installations.
- Infrastructure Development: Strengthen grid infrastructure, develop energy storage technologies, and support the proliferation of distributed photovoltaic systems.
- Education and Public Awareness: Promote public awareness and education on solar technology and launch community demonstration projects.
- International Cooperation: Actively participate in global clean energy cooperation projects and promote the export of solar technology.
- Green Power Purchase Agreements: The sales price stipulated in the Power Purchase Agreements (PPA) for renewable energy power plant projects references the provisions of Minister of Energy and Mineral Resources Regulation No. 50 of 2017 (on the Utilization of Renewable Energy for Power Generation). The scope of PJBL also references Minister of Energy and Mineral Resources Regulation No. 10 of 2017 (as amended by Minister of Energy and Mineral Resources Regulation No. 49 of 2017 on Power Purchase Agreement Points).
Budget and Funding Sources:
The overall budget for this plan is estimated at $150 billion to $200 billion annually, with funding sources including government allocations, social capital, international cooperation funds, and green bonds and loans.
At the press conference, Indonesia’s Minister of Energy and Mineral Resources, Bahlil Lahadalia, announced that Jakarta’s solar project has fully commenced operations, marking a significant milestone in Indonesia’s transition to clean energy. Minister Bahlil Lahadalia stated, “The successful operation of the Jakarta solar project demonstrates our significant progress in promoting renewable energy development. This not only provides clean and sustainable energy for the capital but also sets an example for other solar projects across the country. Moving forward, we will continue to advance similar projects to ensure the widespread application of solar energy nationwide.”
The Indonesian government is confident that through the comprehensive implementation of these measures, the solar industry will become an integral part of the national energy mix in the coming decades. This will not only significantly reduce greenhouse gas emissions but also promote economic growth, create more job opportunities, and enhance national energy security.
The Indonesian government will continue to collaborate with all stakeholders to steadfastly advance clean energy development and lead the nation towards a sustainable future.
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