“The idea of the remote is to conveniently control every electronic device in one hand,” said Replus cofounder Amsa Mustaqim during a pitch deck in South Jakarta last week.

Aside from convenience, the US$16 remote’s other selling point was a promise of reducing users’ household electricity consumption by up to 30 percent through automatically and remotely turning off unused devices.

It was the promise of electricity efficiency that landed Replus, a two-year-old company headquartered at the University of Indonesia, a position alongside eight businesses in this year’s Nyala accelerator program for energy-related startups.

The three-month program, which ended last week, was organized by startup school Digitaraya and sponsored by renewable energy fund New Energy Nexus Southeast Asia, to promote both efficient electricity usage and renewable energy technology.

The other Nyala startups were related to solar power (Weston Energy, Khaira Energy, EREnesia and TAZ) and biofuels (AfterOil and Ailesh Power), as well as energy consultancy (Inovasi Dinamika Pratama).

“Indonesia’s energy startup space is quite young. But there is a lot of attention from Indonesia and the outside to promote innovation that could solve the country’s energy challenges,” said Digitraya vice president Nicole Yap during the pitch deck.

The deck was also an opportunity to introduce potential investors, such as UOB bank, Skystar Capital and Venturra Discovery to the local energy start-up scene, which includes other players such as Akua Energy in Bali and RESCO Sumba Terang in East Nusa Tenggara.

While startup investors in Indonesia are diversifying into lesser known sectors including energy, health and education, such nascent sectors remain overshadowed by the established sectors of e-commerce, ride-hailing, online travel, online media and financial technology.

A case in point, a recent Google-Temasek report said nascent sector investments only accounted for 8.8 percent of the $9.1 billion fundraised in Southeast Asia early last year, while the remaining 91.2 percent went to the established sectors.

Hariyanto, director of energy conservation at the Energy and Mineral Resources Ministry, expressed support for energy startups by saying that they could help the government reach the target of 100 percent electrification by 2020 and 23 percent renewables in the energy mix by 2023.

“There is opportunity for energy start-ups because we still need a way to coordinate electricity supply between energy sources so that it becomes reliable,” he added.

However, various stakeholders have criticized the ministry for issuing regulations that discouraged renewable energy investments, such as Ministerial Regulation No. 49/2018 on utilizing rooftop solar panels for state utility company PLN customers.

The regulation was meant to promote the use of photovoltaic cells by establishing legal certainty, but instead the Indonesia Rooftop Photovoltaic Users Association (PPLSA) slammed the regulation, saying that it made installing photovoltaic cells costlier and thus discouraged investment.

“The new regulation on electricity export-import has caused our electricity bills to soar by up to 100 percent. It makes the PV solar panels for residential use unattractive,” said PPLSA chairman Yohanes Bambang Sumaryo.

The regulation directly affects at least two Nyala startups, which are Khaira Energy and Weston Energy, as both of their core products are photovoltaic systems.

Rick Firnando, green project manager at Weston, said his company responded to the regulation by switching its focus from residential areas to remote villages in eastern Indonesia, where PLN’s electric grid has limited reach.

The photovoltaic provider, founded in 2015, earned at least $58,500 last year, most of which came from selling $195 solar panel systems to remote villages around Sumatra and eastern Indonesia.

“In residential areas, our customers tend to be more environmentally conscious because those who look to reduce electricity costs tend to reconsider investing in solar energy,” he said.

Atiek Puspa Fadhilah, an energy advisor for German development agency GIZ, praised Weston for focusing on remote villages because startups — such as Replus and Khaira — tend to focus on major cities.

Khaira earned $220,000 last year, much higher than Weston, but as Skystar Capital investment analyst Shefali Dodani pointed out it was the latter provider that had greater long-term growth potential because it was targeting big cities as well as 350,000 remote houses without electricity.

“I wouldn’t worry too much about high profit margins. If the energy startups can drive down costs [for consumers] to increase demand and scale the business, fundraising will not be a problem,” she said during the pitch deck.

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