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
Students from Indonesia’s leading universities have once again taken to the streets in Jakarta and other major cities, about eight months after the last wave of mass protests turned violent. This time, they are specifically targeting President Prabowo Subianto’s leadership and governing style, which they blame for the country’s current economic difficulties.
Unlike in previous protests, however, the Indonesian Military (TNI) was deployed from the outset to help manage the situation amid growing calls from some government critics for political change. Despite a few minor scuffles, the demonstrations on June 12 remained largely peaceful, with both protesters and security forces exercising restraint.
Student leaders have vowed to return to the streets after giving Prabowo an opportunity to respond to their five-point list of demands. They also plan to reassess their strategy in light of the military’s involvement. The following Monday, additional student groups, joined by civil society organizations, staged demonstrations in Jakarta, suggesting that public dissatisfaction extends beyond university campuses.
The movement in Jakarta was led by the “Yellow Jackets,” a group of students from Universitas Indonesia, the country’s premier public university. They were joined by students from other public and private universities in the capital, as well as in several major cities across the country.
Under the banner “Toward a Bankrupt Indonesia,” the students are demanding that the government stop squandering state funds, reduce the prices of food and fuel and roll back the President’s flagship programs, including the free nutritious meal program and the establishment of the Red and White Rural Cooperatives program. They are also calling for an end to the military’s involvement in civilian affairs and for the President to acknowledge and take responsibility for policy mistakes.
The protests come amid an economic downturn marked by the rupiah’s decline to historic lows of more than Rp18,000 against the US dollar and a fall in the Jakarta stock market.
Analysts say that what began as a loss of confidence among foreign investors has spread to Indonesia’s middle class. The lower middle class, represented in part by the student movement, has expressed its frustration by taking to the streets. Analysts also point to an erosion of political confidence amid signs of shrinking civic space and the expanding role of the TNI in civilian affairs.
The protests last August targeted the House of Representatives over its perceived poor performance, particularly after legislators approved generous increases in their housing allowances. Students were soon joined by workers, and police attempts to crack down on the demonstrations led to violence that spiraled out of control. Prabowo subsequently ordered the military to help restore order.
This time, the military was deployed immediately as a backup force to assist the police.
In Jakarta, security forces were deployed to prevent students from staging their protest at the Hotel Indonesia Traffic Circle on Jalan Thamrin, the city’s main thoroughfare. Instead, they were directed toward the House of Representatives complex in Senayan. Student leaders, however, said the House was not their intended target.
Presidential Palace chief spokesman Mohammad Qodari said the students’ demands were broadly aligned with Prabowo’s efforts to make government spending more efficient and effective. He added that the free meals program was also under review following recent changes in the agency responsible for its implementation.
Qodari, however, did not address concerns about the military’s expanding role in civilian affairs, an issue that also featured prominently during the August protests.
For now, tensions remain contained. But with student leaders promising to reassess their strategy and public dissatisfaction showing few signs of easing, the prospect of renewed demonstrations cannot be ruled out.
