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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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.
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.
Latest News
State-owned telecommunications giant PT Telkom Indonesia (Telkom) has faced tough competition in the government's bidding for broadband wireless access (BWA) rights on the 1.4 gigahertz (GHz) frequency spectrum. The government intends to use this frequency to deliver fast and affordable household internet—targeting 20 million homes with minimum speeds of 100 Mbps and monthly fees of around Rp100,000. As it turns out, Telkom lost bids in all three regions across Indonesia, with the winners being companies affiliated with President Prabowo Subianto 's brother, Hashim Djojohadikusumo, and the Sinar Mas Group conglomerate.
PT Telemedia Komunikasi Pratama (Viberlink), a subsidiary of PT Solusi Sinergi Digital (Surge), won BWA rights for Region I, covering Zones 4, 5, 6, 7, 9, and 10, which span Java, the Maluku Islands, and Papua—home to more than 60 percent of Indonesia's population. Meanwhile, PT Eka Mas Republik (MyRepublic), a subsidiary of PT Dian Swastatika Sentosa, part of the Sinar Mas Group, secured BWA rights for Regions II and III. Region II (Zones 1, 2, 3, 8, and 15) includes Sumatra, the Riau Islands, the Bangka Belitung Islands, Bali, and the Nusa Tenggara Islands, while Region III (Zones 11–14) covers Sulawesi and Kalimantan.
Viberlink won the Region I bidding with Rp403.76 billion (US$24.19 million), while MyRepublic's winning bids for Regions II and III reached approximately Rp300.89 billion and Rp100.89 billion, respectively. In comparison, Telkom had bid Rp399.76 billion, Rp259.9 billion, and Rp80 billion for the three regions. MyRepublic had also bid Rp331.77 billion for Region I, while Viberlink's bids for Regions II and III were Rp136.17 billion and Rp64.41 billion.
The bidding was held by the Communications and Digital Affairs Ministry (Komdigi) from Oct. 13 to 15, following a bidding process launched on July 28. The ministry aims to expand affordable home internet access, noting that only 21.31 percent of Indonesia's 69 million households are currently connected to fixed broadband. Komdigi requires the bidding winners to connect 20 million households, nearly double the 10.1 million homes currently served by Telkom's IndiHome, Indonesia's largest fixed broadband service.
The 1.4 GHz network will also be used to connect public facilities, including schools, community health centers (puskesmas), and local government offices, using fixed wireless access (FWA) technology. FWA works by transmitting wireless internet signals from base transceiver stations (BTS) connected to a wired internet backbone to consumer premise equipment (CPE) such as home modems. This method eliminates the need for direct fiber-to-the-home (FTTH) connections, reducing costs in areas where fiber rollout may be uneconomical due to low population density.
However, the winning bidders still need to build extensive network infrastructure, secure BTS sites, and address the rising costs of components such as CPEs, which have increased following the bidding announcement due to anticipated demand—similar with trends observed in Japan. The Indonesian Internet Providers Association (APJII) noted that most existing BWA networks in Indonesia operate at 1.8, 2.1, or 2.3 GHz, meaning the 1.4 GHz spectrum will require new ecosystems and compatible devices. Additionally, FWA's scalability may be limited, as a BTS's capacity must be shared among multiple households.
Following its win, Viberlink announced partnerships with PT Tower Bersama Infrastructure (TBIG) and PT Centrama Menara Indonesia (CENT) to build 50 BTS units. The company is also collaborating with Huawei Indonesia and Qualcomm Technologies Inc. to develop an end-to-end ecosystem covering the core network, radio systems, and CPEs. For its Radio Access Network (RAN), Viberlink will work with OREX SAI, Nokia, Huawei, Baicells, and Fiberhome.
Given the critical role of telecommunications infrastructure in supporting economic growth and living standards, the success of this affordable internet program could deliver major benefits to Indonesia. Private sector participation could also allow Telkom to focus on more lucrative projects. However, the project's feasibility remains uncertain due to cost pressures—and the government must ensure that potential conflicts of interest are avoided, especially as Hashim Djojohadikusumo already heads the task force for President Prabowo's 3 million subsidized housing program.
