Bahlil Calls for Accelerated Geothermal Development
Energy and Mineral Resources (ESDM) Minister Bahlil Lahadalia has urged geothermal businesses to accelerate the development of Geothermal Power Plants (PLTP).
This is particularly important as the government has set a target of adding 5.2 Giga Watts (GW) of PLTP capacity in the 2025-2034 Electricity Supply Business Plan (RUPTL).
Bahlil said this acceleration can only be achieved through collaboration between businesses and the government.
He explained that when he first took office as Minister of ESDM, he immediately made breakthroughs to speed up geothermal development in the country by cutting lengthy regulations. However, even after those changes, geothermal development has remained slow.
“Since I was inaugurated as Minister of ESDM, what has been causing the delays? After I first came in, businesses wanted to move quickly, but what if the regulations are convoluted and slow? So I cut the lengthy regulations. But there are still many obstacles. There is no other way to accelerate the implementation of geothermal into electricity; there must be collaboration between businesses and regulators. If it reaches 5 US cents per kWh but the association is still lacking, we will implement tax incentives. We will amend the Presidential Regulation and Government Regulation on geothermal business,” Bahlil explained during his opening speech at The 12th Indonesia International Geothermal Convention & Exhibition at the Jakarta International Convention Center on Wednesday (19/8/2026).
He also asked the National Energy Council (DEN) to help monitor the progress of geothermal projects.
“To get there, I ask for a commitment that once a concession is obtained, it must be accelerated. I always sign temporary suspensions; this is part of the strategy. If there really is a problem, thank God, but as a former businessman, these suspensions extend the contract period. If there is a technological or financial problem, that is a problem,” he said.
“Friends from the DEN (National Energy Council), please monitor this. Do not allow those temporary extensions, and do not let there be any abuse either. Permits have been extended once, some want twice, some want three times. If you want to be hit with a termination, lobby again. That is fine, but the important thing is to have commitment. Whoever is working on it does not matter, what matters is speed,” he added.
According to him, accelerating geothermal development is necessary because, in addition to generating electricity, it can also create a multiplier effect on the economy.
“Geothermal, in my view, is not only about increasing electricity but also about converting it to generate an economy that creates jobs, coffee mills, other industries, and so on. There is a multiplier effect,” he said.
He also stressed the need for innovation in technology. Without technological innovation, he said, it would be difficult for businesses to compete competitively.
“Fossil energy may be the present and the past, but the future is new and renewable energy,” he asserted.
Based on data from the Ministry of ESDM, Indonesia currently ranks second in the world in installed geothermal capacity. Indonesia’s total geothermal potential reaches 23,202.77 MW, while installed capacity is around 2,776.39 MW. Thus, only about 11.6% of the geothermal potential has been utilised, and around 88.4% remains untapped.
Indonesia’s geothermal potential is spread across various regions. Sumatra has a potential of around 9,441.10 MW, Java around 7,587.80 MW, Sulawesi around 3,006 MW, and Nusa Tenggara around 1,272.87 MW. Meanwhile, Kalimantan, Bali, Maluku, and Papua also have geothermal potential, but according to the presentation materials, they do not yet have installed capacity.
For 2026, the government is preparing development at 2 Preliminary Survey and Exploration Assignment (WPSPE) locations and 4 Geothermal Working Areas (WKP), with total resources of around 131 MW, additional capacity of around 185 MW, and a projected investment value of around US$ 1.16 billion.
The government is also preparing a number of regulatory and investment catalysts to accelerate geothermal development, including through a revision of Government Regulation Number 7 of 2017, which is directed at supporting indirect utilisation of geothermal energy and increasing the rate of return on investment, as well as a revision of Presidential Regulation Number 112 of 2022 to accelerate the development of New and Renewable Energy (EBT).