Sector
Energy
Indonesia possesses vast, distributed, and diverse energy resources. The country’s energy subsectors include gas, clean water, and electricity, with demand projected to increase to 464 terawatt-hours (TWh) by 2024 and further increase to 1,885 TWh by 2060. The use of renewable energy is a top priority and the government has set ambitious goals in the General Planning for National Energy (RUEN) and General Planning for National Electricity (RKUN) to integrate 23 percent renewable energy into the national energy mix by 2025. At least US$41.8 billion of investments are needed to fully realize the goal.
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Indonesia possesses vast, distributed, and diverse energy resources. The country’s energy subsectors include gas, clean water, and electricity, with demand projected to increase to 464 terawatt-hours (TWh) by 2024 and further increase to 1,885 TWh by 2060. The use of renewable energy is a top priority and the government has set ambitious goals in the General Planning for National Energy (RUEN) and General Planning for National Electricity (RKUN) to integrate 23 percent renewable energy into the national energy mix by 2025. At least US$41.8 billion of investments are needed to fully realize the goal.
Despite having a renewable energy potential estimated at around 3,000 gigawatts (GW), current utilization is merely about 12.74 GW or 3 percent. This renewable energy potential includes solar energy, which is widely spread across Indonesia, especially in East Nusa Tenggara, West Kalimantan, and Riau, with a potential of approximately 3,294 GW and utilization of 323 megawatts (MW). Another renewable energy, hydro energy, with a potential of 95 GW, is primarily found in North Kalimantan, Aceh, West Sumatra, North Sumatra, and Papua, with utilization reaching 6,738 MW.
Additionally, bioenergy, encompassing biofuel, biomass, and biogas, is distributed throughout Indonesia with a total potential of 57 GW and utilization of 3,118 MW. Wind energy (>6 m/s) found in East Nusa Tenggara, South Kalimantan, West Java, South Sulawesi, Aceh, and Papua has a substantial potential of 155 GW, with utilization of 154 MW.
Furthermore, geothermal energy, strategically located in the “Ring of Fire” region covering Sumatra, Java, Bali, Nusa Tenggara, Sulawesi, and Yogyakarta has a potential of 23 GW and utilization of 2,373 MW. Meanwhile, marine energy, with a potential of 63 GW, especially in Yogyakarta, East Nusa Tenggara, West Nusa Tenggara, and Bali, remains untapped.
Among the renewable energy sources and their potential, these projects entail significant investments. According to the Electricity Supply Business Plan (RUPTL) of the State Electricity Company (PLN), from 2021 to 2030, geothermal power plants require an investment of US$17.35 billion, large-scale solar power plants necessitate US$3.2 billion, hydropower plants require US$25.63 billion, and base renewable energy power plants require US$5.49 billion. Additionally, bioenergy power plants require an investment of US$2.2 billion, wind power plants US$1.03 billion, peaker power plants US$0.28 billion, and rooftop solar power plants IS$3 billion.
As of 2022, hydro and geothermal are the primary drivers of growth. Private entities had enhanced the capacity of hydro power by adding 603.66 MW in mini, micro, and standard hydro facilities, reaching a total of 2,459.72 MW. Meanwhile, the geothermal sector experienced a 412 MW increase over the last five years from the private sector, bringing the total capacity to 1,782.8 MW by 2022. Aside from these two renewable energy, sources solar energy has also presented significant opportunities, particularly given Indonesia's potential for floating solar systems on reservoirs and dams.
Furthermore, the country’s other national energy subsector of gas underscores Indonesia’s wealth in natural gas. Indonesia’s natural gas reserves are predominantly methane (80-95 percent), which can be used directly or processed into Liquefied Natural Gas (LNG). However, demand has greatly increased over the past decade for Liquefied Petroleum Gas (LPG). From 2018 to 2022, domestic LPG production reached between 1.9 to 2 million tons, which is insufficient to meet national needs, leading to increasing imports that reached 6.74 million tons in 2022.
Currently, the Energy and Mineral Resources Ministry is working to attract new investments for LPG refineries through a cluster-based business scheme for the construction or future development of new LPF refineries. The ministry has identified the potential of rich gas to produce an additional 1.2 million tons of LPG cylinders domestically.
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A major earthquake in East Nusa Tenggara (NTT) has once again put Indonesia’s disaster preparedness under scrutiny, raising tough questions about political will and shrinking mitigation budgets. Sitting squarely on the Pacific Ring of Fire, Indonesia faces inherent geological risks. Yet policymakers too often treat this geography as an excuse for poor outcomes rather than an urgent mandate for better preparation.
The magnitude-7.7 earthquake struck off Flores Island near Nagekeo on Aug. 15. By Aug. 26, the Meteorology, Climatology and Geophysics Agency (BMKG) had recorded 7,492 aftershocks, the strongest reaching magnitude 6.2, with no clear sign of tapering off.
The human and material toll has been severe. As of Aug. 25, the National Disaster Mitigation Agency (BNPB) reported 105 deaths, 1,678 injuries and 179,037 displaced residents. The tremor damaged nearly 78,000 homes, alongside 118 health facilities, 1,378 educational buildings, 483 government offices, 402 houses of worship and 156 road sections.
Beyond the immediate devastation, the disaster exposes three fundamental issues.
First is the symbolic weight of the government's response. President Prabowo Subianto did not visit Nagekeo until Aug. 26, or 11 days after the disaster struck, and only after attending his private secretary’s wedding reception. Prabowo defended the delay as deliberate, arguing that high-profile visits risk distracting frontline agencies from urgent rescue operations.
Yet a head of state’s presence carries significant psychological value. For survivors who have lost loved ones, homes and livelihoods, seeing their leader on the ground offers an emotional reassurance that administrative protocols cannot match. It serves as an essential gesture of solidarity, proof that the state recognizes their grief and grants it the highest priority. That reassurance matters even more in distant, less developed regions like NTT, where geographic isolation can quickly breed feelings of political neglect.
This delayed response mirrors the government's handling of the devastating floods and landslides across Aceh, North Sumatra and West Sumatra in late November 2025. Though Prabowo eventually visited the affected areas, his administration drew sharp criticism for a sluggish response and an apparent reluctance to declare a national emergency. Officials later conceded that earlier budget cuts had left key agencies financially strapped, while national leadership hesitated to accept foreign aid out of concern that it might project institutional weakness.
This fiscal strain highlights the second core issue: a sharply shrinking disaster management budget.
The BNPB's funding has cratered in recent years. After peaking at Rp 11.76 trillion (US$664 million) during the height of the COVID-19 pandemic in 2020, allocations consistently held above Rp 4.9 trillion annually from 2021 through 2024 (Rp 7.14 trillion in 2021, Rp 5.05 trillion in 2022, Rp 5.44 trillion in 2023 and Rp 4.92 trillion in 2024). Under the Prabowo administration, however, the budget dropped to Rp 2.01 trillion in 2025 and fell further to just Rp 491 billion in 2026, at a time when the government spent big on Prabowo’s signature programs like the free nutritious meal program and Red and White Cooperatives.
For a country hit by regular natural disasters, such steep cuts severely curtail the BNPB’s operational agility and readiness. While Finance Minister Purbaya Yudhi Sadewa has maintained that the central government can release emergency reserves upon request, reactive funding is no substitute for steady preparedness. In Sumatra, where recovery efforts leaned on depleted regional coffers and ad-hoc central aid, affected communities are still struggling eight months later amid sustained calls from civil society for meaningful support.
In NTT, the cracks in the safety net appeared immediately. BNPB chief Lt. Gen. Suharyanto acknowledged widespread shortages of clean water and electricity at evacuation hubs, including in Reo, Manggarai. Several local administrations lacked basic logistical reserves and financial cushions, which, combined with difficult terrain, severely delayed relief deliveries.
Rugged topography cannot serve as an excuse for sluggish aid; it should be the very premise of robust logistical planning. Predictable necessities, potable water, backup generators, emergency clinics, supply corridors and clear evacuation paths, must be secured long before the ground moves.
This failure shifts the spotlight to the third and most decisive issue: long-term mitigation.
Suharyanto noted that the BNPB's annual allocation for disaster prevention has lingered at a modest Rp 17 billion to Rp 19 billion over the past five years, a fraction of what effective risk reduction requires. NTT is no stranger to seismic trauma; on Dec. 14, 2021, a magnitude-7.4 earthquake devastated communities near Maumere. The latest disaster is not an anomaly, but part of an ongoing pattern of regional vulnerability.
Earthquakes are natural events, but the destruction they leave behind is shaped by human decisions. Public awareness matters, but genuine mitigation remains a state responsibility. Protecting Flores and other vulnerable regions demands resilient spatial planning, strictly enforced earthquake-resistant building codes, sensible coastal zoning and fail-safe emergency infrastructure.
Indonesia cannot stop earthquakes from happening. It can, however, control how much destruction they cause. Ultimately, the true measure of the state’s presence is not whether leaders show up days after a catastrophe, but whether protective infrastructure was built long before the disaster hit.
