When opening Business-20 (B-20) Indonesian Inception Meeting 2022, President Joko “Jokowi” Widodo said that a total of 5.5 gigawatts (GW) capacity of coal-powered power plants (PLTU) are ready for early retirement, as part of the Indonesian commitment to reach net zero carbon emissions in 2060. Indonesia has an ambitious yet promising goal to fully phase out coal power plants by 2056. According to PLN’s 2021-2030, 2025 will see the start the replacement of coal-fired power plants in Indonesia by renewable energy. Under the country’s recent pledge at COP26, Indonesia seeks to retire up to 9.2 gigawatts (GW) of coal-fired power plants by 2030. On top of that, the country also commits to scaling up the deployment of renewable power generation, scaling up technologies and policies to move from unabated coal power generation, and strengthening domestic and international efforts to support affected parties during the energy transition to renewable energy.

Considering Indonesia’s commitment to phasing out coal-fired power plants along with its budding renewable energy sector, this situation provides opportunities for investors to take part in the country’s transition to renewable energy. In the near term, the 2021-2030 RUPTL itself offers great opportunity for RE developers and investors. In the RUPTL, PT PLN has targeted 40.6 GW new power plant installations in 2021-2030, of which 20.9 BW or 51.6 percent will be sourced from new and renewable power plants. Many of the renewable projects in the RUPTL are actually to achieve a shorter-term target of 23 percent renewable energy in Indonesia’s energy mix in 2025. According to a government estimate, Indonesia requires an investment of US$70 billion to achieve the target of 23 percent renewable energy by 2025.

In this session, opportunities and challenges presented by the 2021-2030 RUPTL and the longer-term coal phase out will be discussed: What are the opportunities available for South Korean investors? What are considerable threats that could hold Indonesia’s RE development? Why should foreign investors consider Indonesia’s transition to clean energy in the first place? What are the concerns of South Korea investors over RE investment in Indonesia?

Speakers

Dadan Kusdiana

Director General of New, Renewable Energy and Energy Conservation (EBTKE)

Nurul Ichwan

Investment Coordinating Board (BKPM) Deputy Chairman for Investment Planning

Darmawan Prasodjo

CEO of PT PLN

Minho Kim

General Manager KOMIPO

Moderator

Yose Rizal Damuri

Executive director of CSIS

Following the plan to retire coal-powered plants in 2030, Indonesia already has several energy alternatives up its sleeve. One of the most prominent renewable energies in Indonesia is geothermal energy. With an installed capacity totalling 2,130.7 megawatts, geothermal power plants are the second-largest renewable energy source after hydro energy, according to the Ministry of Energy and Mineral Resources’ Handbook of Energy & Economic Statistics of Indonesia 2020.10 Most Indonesian provinces have geothermal potential, with West Java leading in terms of greatest potential. To date, however, geothermal potential utilization remains low with uneven distribution, as geothermal electricity production is concentrated in West Java with an installed capacity of around 1,248 MW, 59 percent of the country’s total installed capacity.

In its 2021-2030 RUPTL, PLN plans to work together with independent power producers to generate a total of 1,445 MW from geothermal power plants. Compared to other renewable energy sources, geothermal energy has some edges. First of all, it supplies electricity continuously, 24 hours a day, not intermittently like solar or wind energy. Secondly, it is relatively competitive, with a production cost at around 7 to 8 US cents per kilowatt hour (kWh).11 However, building geothermal plants take time and requires a great amount of investment within the range of billions of US dollars.

In July 2020, South Korea announced its Green New Deal, a development strategy to speed up the post-pandemic recovery and empower its net-zero transition. However, unlike Indonesia, South Korea majors in photovoltaic, wind power, and fuel cells to replace their coal plants capacity by 2029. The session will provide perspectives on why South Korea energy players mainly opt for said energy alternatives and discuss the basis of their choice with Indonesian players.

This session will convene renewable energy players from Indonesia and South Korea and discuss how can the government situate and form an investment ecosystem for their preferred sector where the profits justify the cost of investment and the initial capital injection needed to start a project? What can local enterprises do to initiate projects with more financially stable foreign investors? And why should foreign investors consider Indonesia's geothermal potential in their portfolios?

Speakers

Kwanyoung Kim

Director Green Technology Partnership Initiative

Prijandaru Effendi

Chairman of the Indonesian Geothermal Association

Jinny Lee

Director Asia Division III & Global PPP Unit, EDCF Operation Dept. 1, Korea Eximbank

Ahmad Yuniarto

CEO of Pertamina Geothermal Energy

Moderator

Riyadi Suparno

Executive Director Tenggara Strategics

Indonesia has a vast potential for generating and balancing solar photovoltaic (PV) energy to meet future energy needs at a competitive cost with solar energy identified as an energy source whose technical, environmental and economic potential far exceeds Indonesia’s present and future energy requirements and is far larger than all other renewable energy resources combined. Solar irradiation is available at a stable level all year long, offering an energy potential of more than 200 gigawatts (GW).

In the 2021-2030 RUPTL, PLN relies so much on solar to meet the 2025 renewable energy target of 23 percent in the country’s energy mix. In the five-year period of 2021 to 2025, PLN plans to generate a total of 3,910 megawatts peak (MWp) from solar energy or 36.7 percent of 10,640 MW of electricity from all renewable energy plants. PLN plans to build solar panels in remote islands not connected to grids, work together with independent power producers to build floating solar panels on lakes, existing dams as well as encourage the people and businesses to build more rooftop solar PVs. Moreover, the government’s latest regulation on rooftop solar PV increases net metering/electricity exporting to PLN from 65 percent to 100 percent. All these developments open more investment opportunities for investors/financiers to invest in solar PVs.

This session will convene stakeholders and industry players from Indonesia and South Korea to address the most pressing issues around developing and investing in Indonesia’s solar energy sector, discuss how collaborations between local stakeholders and potential investors could raise the standards of solar projects so that they are investment-worthy, and tackle the problems that have been hindering investment realization into the promising sector.

Speakers

Wiluyo Kusdwiharto

Director of Project Management and New Renewable Energy, PT PLN (Persero)

Fabby Tumiwa

Chairman of the Indonesian Solar Energy Association (AESI)

Eka Satria

CEO of Medco Power

Byeongwoo Jeon

Managing Director, Global Business Department KEPCO KDN

Moderator

Oktoviano Gandhi

CEO of Alva Energi

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Thank you for your interest.