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Indonesia aims to boost electricity capacity, renewable energy

The Jakarta Post
3 minute read

Indonesia is aiming to increase electricity capacity by 5,000 megawatts per year in an effort to support economic growth.

The Energy and Mineral Resources Ministry director general for electricity, Jarman, said that the country had added 4,000 to 4,500 megawatts of capacity per year since 2011.

“From 2014 to 2020, the average annual increase should gradually increase to 5,000 megawatts per year,” Jarman said on the sidelines of the third United States-Indonesia Energy Investment Roundtable in 
Jakarta on Monday.

The country’s total installed capacity reached 46,420 megawatts as of the end of September, according to figures presented by Jarman recently.

“We have to reach 5,000 megawatts per year. If not, [economic] growth will be bottled up and the electrification ratio will not increase,” Jarman said. 

Indonesia has a low electrification ratio compared to its ASEAN neighbors, but Jarman said the rate had increased by 13 percent since 2011 to 80.1 percent as of September. 

The government has been pushing the development of new power plants in an attempt to bolster energy security. However, there are a number of factors hampering the projects, ranging from permits to land clearing.

One such project facing uncertainty over a prolonged land clearing process is a power plant in the Batang area in Central Java with total capacity of 2,000 megawatts.

“We pushed another power plant project ahead to compensate for the delay. We are also organizing a task force, which will help with the land acquisition process,” Jarman said.

During his keynote speech at the energy roundtable event, the Energy and Mineral Resources deputy minister, Susilo Siswoutomo, said meeting energy demand was currently the government’s main challenge.

“We want to meet electricity needs with a combination of [power produced by] traditional fuels and renewable energy. We have no choice as the price of oil is high,” he said.

“We are planning to substitute 1,400 megawatts of capacity produced by diesel power plants with renewable sources, such as micro-hydro, mini-hydro, solar, wind and also from waste,” he said.

Also during the third US-Indonesia Energy Investment Roundtable, the US Department of Energy and the National Renewable Energy Laboratory (NREL) announced a new program called Sustainable Energy for Remote Indonesia Grids (SERIG). The program, which is worth US$1.2 million, will carry out technical and economic analysis on cost-effective renewable energy solutions for remote Indonesian areas that currently depend on fossil-fuel-fired power plants. 

“The optimal conditions we are looking for are remote areas that use expensive diesel fuel and are representative of other Indonesian areas so that the project can be replicated in other places, and the presence of renewable energy resources ready to be exploited, such as solar, hydro and possibly wind,” Daniel Milstein, senior advisor for the US Department of Energy, said.

Kenneth Kelly from NREL said that four provinces had been picked as project sites: Central and South Kalimantan, East Nusa Tenggara and Bangka Belitung.

The SERIG project will be conducted in the next two or three years. The US Department of Energy and NREL are seeking to launch two or three pilot projects following the analysis, which they will present to the Indonesian government and possible funding sources. 

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