PLN EPI projects natural gas demand to rise 4.5% per year

Until 2034, PLN’s gas needs are estimated to grow by around 4.5% per year. Jakarta (ANTARA) - PT PLN Energi Primer Indonesia (PLN EPI) projects that the demand for gas in power generation will continue to rise at around 4.5% per year, in line with the surge in national electricity consumption and the acceleration of electrification in various sectors. “Until 2034, PLN’s gas needs are estimated to grow by around 4.5% per year, with liquefied natural gas (LNG) becoming the backbone in supporting Indonesia’s energy transition,” said PLN EPI’s President Director Rakhmad Dewanto in his statement in Jakarta on Monday. Rakhmad explained that the electricity sector will be the main driver of national energy growth. Based on projections from McKinsey and the General Electricity Plan (RUKN) 2025, electrification in industry, transportation, households, and data centres will increase the electricity sector’s contribution from 28% in 2025 to 38% of Indonesia’s total primary energy needs by 2035. “The power sector is projected to grow the highest at around 4.6-5.4% per year, driven by electrification in transportation, industry, residential sectors, and data centre growth,” Rakhmad said while speaking at the international forum “11th Annual LNG Supply, Transport & Storage Forum 2026” in Bali. This forum is one of the LNG platforms in Southeast Asia, bringing together global gas industry players to discuss developments in the LNG supply chain in Indonesia. PLN estimates that national electricity production will increase significantly, doubling from 283.7 TWh in 2024 to around 581-584 TWh in 2034. During this period, according to Rakhmad, although the share of new renewable energy continues to rise, coal and natural gas will still play an important role in maintaining the reliability of the national electricity system. In 2034, coal is estimated to still contribute 47% of national electricity production. Although renewables rise 4.8-5.6 times, gas remains necessary and is projected to increase 2.3-2.7 times to 132.3 TWh or equivalent to 18-23% of the national power generation mix. Rakhmad added that PLN’s gas needs are estimated to increase from 1,748 BBTUD in 2026 to 2,490 BBTUD in 2034. This increase will be dominated by LNG as a solution to the decline in domestic pipeline gas supplies. “LNG needs will continue to rise to cover the decline in domestic gas production through pipelines and to meet the growth in electricity demand,” he explained. In line with these projections, LNG cargo needs are also estimated to increase by 4.5% per year from 103 cargoes in 2026 to 214 cargoes in 2034. Meanwhile, PLN’s pipeline gas contracts are projected to trend downwards from 757 BBTUD to 667 BBTUD in the same period. To anticipate this surge in needs, Rakhmad continued, PLN EPI continues to strengthen the addition of long-term contracts, including long-term pipeline gas contracts with Conrad and Mubadala that were recently signed by PLN EPI last year. In addition, PLN EPI is also developing national gas and LNG infrastructure through various midstream projects, including floating storage regasification units (FSRU), LNG carriers, onshore receiving units (ORU) in various regions of Indonesia, and the construction of the WNTS-Pemping pipeline. Some of the projects being developed include FSRU West Java 1 and 2, FSRU East Java, FSRU Bali, and FSRU Cilegon. In addition, the development of LNG clusters in the Sumatra-Kalimantan, Sulawesi-Maluku, North Papua, and Nusa Tenggara regions is also ongoing to support the gasification programme for power plants in island regions. Overall, PLN EPI targets a regasification capacity of 3,850 MMSCFD with storage capacity up to 1.2 million cubic metres. According to Rakhmad, strengthening LNG infrastructure is a strategic step to reduce reliance on fuel oil and increase national energy resilience in line with the government’s Astacita. “This is no longer an option. Gas and LNG infrastructure must be built to support Indonesia’s energy resilience and transition,” he said.