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View all search resultsIndonesia’s clean energy future can power its economic growth
The country is rich in untapped potential for solar and hydro power and is already the world’s second-largest producer of geothermal power.
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Hilly terrain forms a backdrop on Nov. 9, 2023, against the Cirata Floating Solar Power Plant at Cirata Reservoir in Purwakarta, West Java, the largest energy facility of its kind in Southeast Asia. (AFP/Bay Ismoyo)
W
hatever official agreement comes out of the United Nations’ COP30 climate conference currently underway in Brazil, cities and countries are proving that switching to clean energy goes hand in hand with economic growth and modernization, and the countries that move boldly will gain a competitive edge. Under President Prabowo Subianto’s leadership, Indonesia is well-positioned to prove the point, and reap enormous benefits along the way.
Prabowo has recognized the opportunity ahead for Indonesia and set ambitious goals for inclusive growth and expanding clean energy. The key to reaching those goals lies, as it does in countries around the world, in knocking down barriers to investment, including by attracting more private finance.
Indonesia has a jump-start on that work. At the 2022 G20 Leaders Summit in Bali, Indonesia joined international partners to create a Just Energy Transition Partnership, or JETP. The partnership brings together public and private finance, supported by the Glasgow Financial Alliance for Net-zero, or GFANZ, to catalyze investment in Indonesia’s clean energy priorities.
The partnership has already seen some promising success, including bringing private finance into a floating solar power plant project in West Java that increased the nation’s solar generation by 13 percent and the expansion of a geothermal plant in West Sumatra that has doubled its power-generation capacity.
The partnership is only just beginning to scratch the surface of what is possible in Indonesia. For instance: The president has pledged to bring solar power to every Indonesian village, and JETP projects could help to replace expensive diesel generators across remote islands with solar power, driving down emissions and improving the reliability of electric power to homes and small businesses.
Switching to clean energy is essential to Indonesia’s economic growth. The country is rich in untapped potential for solar and hydro power and is already the world’s second-largest producer of geothermal power. The cost of solar power has plummeted, making it cheaper than fossil fuels in most of the world. As a result, last year, more global energy was produced by solar panels than by coal-fired power plants for the first time. This expansion is poised to accelerate with improvements to battery storage, an industry that Indonesia can help to lead, thanks to the country’s abundant reserves of the needed critical minerals including nickel and copper.
Switching to clean power will also make Indonesia an attractive market for global companies and investors looking for low-cost, low-carbon electricity for data centers, pharmaceutical and auto manufacturing, food and beverage companies, and others. These industries are a big source of foreign investment, and local jobs, for Indonesians.
