Indonesia's race to net absolutely no

om pv publication 05/23

In 2021, Indonesia’s government committed to achieving carbon neutrality by 2060 at the latest. Solar’s importance has been reaffirmed by the Ministry of Energy and Mineral Resources (MEMR), the International Energy Agency (IEA), and the International Renewable Energy Agency (IRENA). The IESR’s “Indonesia Solar Energy Outlook 2023” report found that the country’s PV output has declined sharply without decarbonization requirements.

The country is home to 275 million people, making it Southeast Asia’s most populous and most economically powerful. They predict it will be the sixth largest economy in the world by the year 2030. The country’s technical solar producing capacity might be anywhere from 3 terawatts-peak (TWp) to 20 TWp, depending on land use. In a document titled “Deep decarbonization of Indonesia’s energy system,” IESR researchers estimate that by 2050, a zero-emission energy system may be sustained by around 1.5 TWp of that capacity, spread across about 2.5% of Indonesia’s area.

A cashless economy in Indonesia will likely utilise solar power due to its low cost and adaptability. By mid-century, solar and, to a lesser extent, wind will provide 55% of Indonesia’s electrical power, according to an IEA plan consistent with keeping the global temperature rise this century at 1.5 C. IRENA predicts that solar energy will provide between 56% and 62% of Indonesia’s electricity demand by 2050. greater power plants, greater energy storage, better connections between islands—these are all things that need to be improved.

Present development

However, data from the ministry of energy shows that by the end of December, Indonesia had only released 270 MWp of solar, which is just around 0.01% of the cheapest technological potential estimate. In a country where state-owned energy company Perusahaan Listrik Negara (PLN) generates, transmits, and distributes electricity, the market for this service is plagued by policy and regulatory uncertainty, as well as a lack of planning and execution.

There were only 8 jobs with a total generating potential of 600 MW in the pipeline last year, all of which were bid before the power plan was created, despite PLN’s 10-year power advancement strategy, to 2030, imagining 4.7 GW of solar, including 3.9 GW functional by 2025.

The first phase of PLN’s 2015 proposal to replace 500 MW of small diesel plants in distant locations has already been bid, but unfavourable results mean the procurement process will be held again, delaying the project. The energy company has been criticised for causing market uncertainty due to its opaque auction schedule.

Brilliant areas

There have been accomplished goals. Prices for solar PPAs dropped from $0.25/kWh in 2015 to $0.058/kWh in 2020, a decrease of 76%. When included in the two record-low quotations for floating solar projects in Singkarak and Saguling, with a combined production capacity of 110 MW, the price drop is 84% (to less than $0.04/ kWh) because to PLN subsidiary Indonesia Power’s equity partner choice procedure. This year, the PLN company announced the second phase of its equity partner selection for utility-scale solar and wind centres, as well as an invitation to compete for a 100 MW floating solar project at Karangkates dam.

Although rooftop solar has expanded little with 2018’s introduction of net metering laws, the industry has been hindered by PLN’s restrictions. Each kilowatt-hour exported to the grid by net-metered solar owners would get a full kilowatt-hour off electrical power bills, up from the current 65% credit granted by PLN, according to a guideline published by energy minister Arifin Tasrif in 2021.


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The net metering application process was also outlined by the energy minister, however PLN ultimately decided not to implement the new system due to grid capacity concerns, limiting the capacity of net-metered planetary systems to between 10 and 15 percent of a prosumer’s electrical power connection.

Jakarta is looking for a middle ground to alleviate PLN’s capacity as fewer net-metered customers show up in 2022 compared to prior years. Concerns and suggestions include doing away with net metering and implementing an application quota system. Removing capacity limits for commercial solar might be beneficial, but homeowners and small businesses using solar power would likely face higher upfront costs and a longer payback period for net-metered installations.


pv publication print edition

In the latest issue of pv magazine, Vincent Shaw and Frank Haugwitz reflect on China’s incredible 20-year journey from solar newcomer to the installation of more over 100 GW(AIR CONDITIONER) of panels this year. We examine the humming exhibition and gigafatory preparation that is bringing forth a solar revival in Europe and what Indonesia has to do to reach its net-zero goal.

There is much more work to be done by the central government of Indonesia and PLN to make solar-powered decarbonization successful in the country. Indonesia’s Just Energy Transition Partnership, funded by a number of international financing organisations, and the country’s 2015 leadership of the Group of Twenty (G20) group of economies both provided impetus for the transition away from coal.

To achieve the national target of reducing peak power sector emissions to 290 megatons of CO2 by 2030 and having renewables supply 34% of electrical energy this year, the early retirement of coal and widespread adoption of solar are essential.

Indonesia, which is serving as the Association of Southeast Asian Nations’ energy chairman this year, may improve solar energy’s utility in the context of regional and national energy security by fostering regional collaboration in the power system and beyond. Even if it’s a winding road, solar is clearly the way to go for clean, cheap, and equitable energy.

has worked as a solar consultant for federal government agencies, state and local governments, and international organisations. He has a background in product science and has worked in the field of solar batteries.

The Association for Solar Energy in Indonesia. For over twenty years, he has dealt with various energy strategies and programmes.

The original print version of this article incorrectly advised that Indonesia’s technical solar capacity be measured in petawatts-peak (PWp), but this version corrects it to terrawatts-peak (TWp).

This article’s author’s views and opinions are their own and may not reflect those of pv publisher.

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