indonesia

governments with low electrification rates have expressed greater interest in applying solar power
on a large scale rather than merely as a stand-alone home system, as solar is usually employed. 18
Hydropower. Indonesia’s hydropower potential is estimated at approximately 75,000 MW, but
the current installed capacity of the country’s hydropower plants is only 8,671 MW, or around 12%
of the potential. The greatest potential for hydropower is found in outer islands, such as in Borneo
and Papua, far from the electricity demand center in Java. Mini- and micro-hydropower plants
could play a significant role in meeting demand for electricity in rural and other remote areas in
the archipelago. However, the potential for mini- and micro-hydropower has not been harnessed
effectively enough to provide large-scale hydropower. 19
Wind. Most of the country’s potential for wind power is found in the Nusa Tenggara
islands. Average wind speed in Indonesia is quite slow (3–6 meters per second), yielding an
estimated total potential of approximately 62 GW. Indonesia has developed limited facilities for
researching wind energy in Nusa Tenggara and southern parts of Java but has not yet developed
it for commercial use. 20
Tidal. Indonesia has a vast ocean territory, but energy from the ocean (such as wave, stream,
and thermal) is only in the early identification stage. The government has identified the potential
for commercial development of approximately 2 GW of wave energy and 41 MW of ocean thermal
energy conversion, among other sources. 21
Bioenergy. Bioenergy could produce electricity and can also be used as fuel (liquid, gas, or solid).
Indonesia has a diverse and potentially large supply of bioenergy from palm, molasses, corn, rice
husk, and city waste, among other sources. Although the potential energy produced from biomass
has been estimated at 33 GW, on-grid capacity of installed crude biomass, biogas, and city waste
plants in 2013 had achieved only 90.5 MW. 22
As for liquid fuels coming from biomass resources, in 2013 Indonesia produced nearly 3
million kiloliters of biofuels, roughly two-thirds of which was exported. The installed capacity
of biofuel plants for the same year was considerably larger, standing at 5.6 million kiloliters for
biodiesel (mostly from palm crude) and around 446,000 kiloliters for bioethanol (from molasses
and cassava). The government has mandated the use of biofuels, particularly by the state-owned
energy companies, with increasing targets year by year. 23
Challenges to Development
Despite the diverse and large potential of renewable energy, Indonesia is still using a very small
amount of renewable energy, totaling less than 5% of the country’s energy mix. 24 For decades the
government has subsidized the price of petroleum products (particularly gasoline and diesel oil),
18 Ministry of Energy and Mineral Resources (Indonesia), “New and Renewable Energy, and Energy Conservation Statistics 2013”; and
Ministry of Energy and Mineral Resources (Indonesia), “2014 Handbook of Energy and Economic Statistics of Indonesia.”
19 Nugroho, “Renewable Energy in Indonesia”; Ministry of Energy and Mineral Resources (Indonesia), “New and Renewable Energy, and
Energy Conservation Statistics 2013”; and Ministry of Energy and Mineral Resources (Indonesia), “2014 Handbook of Energy and
Economic Statistics of Indonesia.”
20 Ibid.
21 Ibid.
22 Ibid.
23 Ministry of Energy and Mineral Resources (Indonesia), “New and Renewable Energy, and Energy Conservation Statistics 2013”; and
Ministry of Energy and Mineral Resources (Indonesia), “2014 Handbook of Energy and Economic Statistics of Indonesia.”
24 Nugroho, “Renewable Energy in Indonesia.”
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