The Institute for Essential Services Reform says Indonesia’s photovoltaic (PV) industry has faced a downturn over the past two years, but policy reforms should accelerate solar deployment in the coming years. The think tank’s latest report says there are currently 16.92 GW of projects in the pipeline across the country.
Indonesia’s total installed solar capacity reached 717.71 MW in August, according to figures released by the Institute for Essential Services Reform (IESR).
Indonesia’s total installed solar capacity reached 717.71 MW in August, according to figures released by the Institute for Essential Services Reform (IESR).
The Jakarta-based think tank recently published its “Indonesia Solar Energy Outlook 2025” report. IESR Executive Director Fabby Tumiwa said Indonesia needs to “catch up” with the global solar trend, following a downturn in Indonesia’s solar industry over the past two years.
But he added that the trend is reversing and the future of solar in Indonesia looks “promising.” The IESR said state-owned utility PLN’s plans to increase renewables capacities should bring 7.9 GW of new solar by 2033, while policy changes enacted by the Ministry of Energy and Mineral Resources are expected to contribute to over 5 GW of new rooftop solar within the next five years.
The report said there were a total of 16.92 GW of announced solar power projects in the pipeline across the country as of August 2024. It is projected that between 350 GW and 550 GW of solar will be installed by 2050.
Solar energy-related investment in Indonesia almost doubled from $68 million in 2021 to about $200 million (USD 135 million) in 2023, the report adds. In 2024, about $167 million of investment in solar energy has been announced as of August.
Tumiwa is calling for the Indonesian government to be more ambitious in its solar deployment targets, explaining the current plan is far short of what the country needs to achieve in order to meet Paris Agreement targets. The IESR said Indonesia would need to achieve 77 GW of solar by 2030 to meet the targets, equivalent to between 9 GW and 15 GW of new solar per year.
“While it’s true that solar PV faces intermittency challenges, using this as a reason to limit its development is not justified,” Tumiwa said. “Many countries have solar PV penetration above 10% of their total power capacity without experiencing electricity supply issues or blackouts. Intermittency can be addressed by integrating energy storage systems into the electricity grid.”
In a separate report focused on energy storage, the IESR predicted that at least 60.2 GW of energy storage will be required if Indonesia meets projections of solar and wind power making up 77% of the country’s installed generation capacity by 2060. The report explained that Indonesia is still in the early stages of energy storage adoption and stresses the need for a comprehensive strategy to accelerate the development of an energy storage ecosystem.
“Currently, there is no large-scale energy storage system operational in Indonesia. The development of small-scale energy storage technology is being led by the private sector, followed by state utility companies,” said His Muhammad Bintang, the author of the report. “Conversely, the establishment of an electricity export scheme to Singapore could accelerate the implementation of energy storage systems and battery energy storage systems in Indonesia. This scheme is projected to increase the installed energy storage capacity in Indonesia by up to 1,000 times, with a total capacity expected to reach 33.7 GWh by 2030.”
Patrick Jowett, pv-magazine-australia.com
