Indonesia\u2019s 100 GW Solar Push Faces Land, Tariff Challenges: IESR<\/p>\n
Jakarta. The Institute for Essential Services Reform (IESR) on Friday\nwarned that Indonesia\u2019s plan to build 100 gigawatts (GW) of solar power\ncapacity will depend not only on massive investment, but also on\nimprovements in procurement systems, land readiness, and renewable\nenergy regulations.<\/p>\n
Speaking at a media briefing in Jakarta, IESR said the government\nmust build a faster, more transparent, and more bankable system to\naccelerate solar project development.<\/p>\n
\u201cThe transition away from diesel power needs to be accelerated\nthrough the procurement of solar power plants that are more transparent\nand efficient, supported by practical tariff regulations to make solar\nenergy investments more attractive,\u201d IESR CEO Fabby Tumiwa said.<\/p>\n
IESR identified Indonesia\u2019s diesel reduction program as one of the\nmain opportunities to accelerate solar deployment. Under PLN\u2019s 2025-2034\nElectricity Supply Business Plan (RUPTL), the state utility plans to cut\ndiesel-generated electricity supply by 80 percent by 2030, targeting\naround 3,996 diesel generators across 1,234 remote locations.<\/p>\n
However, procurement for diesel replacement projects has faced\nrepeated delays. A 2022 bidding process reportedly drew limited investor\ninterest, while follow-up consortium plans in 2023 ran into tariff\napproval problems.<\/p>\n
IESR said procurement mechanisms need to be redesigned to make\nprojects more attractive and financially viable. The group proposed\nbundling smaller regions into larger project packages to improve\neconomies of scale and reduce logistical costs.<\/p>\n
The organization also highlighted opportunities to reduce fuel\nconsumption through programs integrating solar power plants and battery\nenergy storage systems (BESS) into larger grids still dependent on\ndiesel generators.<\/p>\n
PLN\u2019s annual fuel consumption remains high at around 4 million\nkiloliters, making solar and battery integration a potentially major\ncost-saving strategy if supported by clear tariff and procurement\nrules.<\/p>\n
IESR also urged the government to immediately issue tariff\nregulations for hybrid power plants to support wider solar\ndeployment.<\/p>\n
Meanwhile, experts said Indonesia could learn from Vietnam, which has\nSoutheast Asia\u2019s largest installed solar capacity at around 18.66 GW,\ncompared with Indonesia\u2019s roughly 1.49 GW.<\/p>\n
\u201cVietnam has demonstrated that rapid solar expansion can be achieved\nin a short period when supported by strong policies, regulatory\nincentives, and a ready electricity grid,\u201d said Eko Adhi Setiawan,\nsenior lecturer in Energy Systems Engineering at the University of\nIndonesia.<\/p>\n
He said Indonesia should focus not only on headline capacity targets\nbut also on building technically and financially viable projects that\ncan later be expanded at scale.<\/p>\n
The warning comes as the government accelerates preparations for\nPresident Prabowo Subianto\u2019s solar energy push. Deputy Energy and\nMineral Resources Minister Yuliot Tanjung said the government has\nstarted preparing around 24,000 hectares of land across Java for\nlarge-scale solar power plant development.<\/p>\n
Yuliot said land availability remains one of the main obstacles in\naccelerating the 100 GW solar program. The government is targeting up to\n100 GW of installed solar capacity by 2029, with estimated investment\nneeds reaching around $100 billion over the next three years.<\/p>\n
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