Greenpeace says solar energy increasingly competitive against fossil fuels

Greenpeace Indonesia Climate and Energy Campaign Manager Iqbal Damanik stated that the trend for solar renewable energy is becoming increasingly competitive compared to fossil fuels in terms of financing in several Asian countries. “Since around 2018, the cost of electricity from solar PV in some countries like India has even been lower than fossil fuel-fired power plants. Entering the first half of 2026, in many Asian countries, the cost of generating electricity from solar PV is also increasingly competitive compared to fossil energy,” he said during a discussion on sharia financial investment and the environment in Jakarta.

Iqbal noted that market potential and public interest in clean energy have actually begun to grow. Research conducted by Greenpeace with the Institute for Economic and Social Research at the University of Indonesia (LPEM UI) found that in urban areas, particularly Jakarta, around 24 percent of respondents are interested in installing solar PV at their homes. However, about 70 percent of respondents stated that installation costs remain too expensive. If financing for renewable energy power plant projects could be reduced by around 5-10 percent, it would potentially replace coal and gas-based electricity by up to 24 percent.

“These findings show that the potential demand for solar energy, especially in urban areas, is actually quite large. The problem is not solely public interest, but rather access to financing and a policy ecosystem that is not yet fully supportive,” he added. Iqbal also highlighted that investors are still not looking at renewable energy power plants like solar due to relatively high investment costs.

Furthermore, Iqbal said the regulatory ecosystem in Indonesia still relatively supports the coal industry. Policies such as the Domestic Market Obligation (DMO), which guarantees a portion of coal production is absorbed for domestic needs, still provide market certainty for coal. Based on data obtained by Greenpeace, financing from national banks to the coal industry in Indonesia reached approximately USD 7.2 billion. This funding covers both the mining sector and coal-fired power plants (PLTU), indicating that banking interest in the coal industry remains quite substantial. “Factors like these make the coal industry still seen as attractive from a financing perspective,” he said.

Iqbal stated the government needs to review regulations that should facilitate public adoption of solar renewable energy, considering the layered burden of coal’s impact on Indonesia, including mining activities, increased greenhouse gas emissions, and the country’s vulnerability to the climate crisis and extreme weather.