Indonesia Urged to Accelerate Renewable Energy Push to Stay Globally Competitive

Indonesia stands at a pivotal crossroads in its energy journey. As global momentum behind renewable energy intensifies, a recent opinion piece in The Jakarta Post highlights the urgent need for the world’s fourth most populous nation to accelerate its clean energy transition to remain economically competitive.

The Stakes: Global Competitiveness and Climate Leadership

The article underscores that 76 percent of new power capacity additions in Indonesia’s latest energy development plan are set to come from renewables. This aligns with the government’s ambition, as seen in the newly released 2025–2034 Electricity Supply Business Plan (RUPTL), which prioritizes an additional 42.6 GW of renewable energy and significant investment in supporting infrastructure over the next decade. The plan, described as “Beyond the Greenest RUPTL” by Indonesian officials, aims to boost electrification, support industrial growth, and address the nation’s rising power demand.

But as the Indonesia Energy Transition Outlook 2025 notes, while the direction is promising, renewables currently account for only 14% of the national energy mix—well below the 23% target set for 2025. The continued reliance on coal, which remains a major greenhouse gas emitter, presents a significant challenge for Indonesia’s decarbonization goals.

Also Read: Indonesia’s Energy Transition

Bottlenecks: Policy, Investment, and Regulation

The Jakarta Post warns that despite the ambitious targets, political and investment bottlenecks could slow Indonesia’s progress. The renewable energy sector faces hurdles including:

• Regulatory uncertainty and slow permitting processes
• Financial gaps and limited incentives for private investment
• Monopoly and heavy regulation by state-owned utility PLN
• Preference for coal as an indigenous resource

These issues have hampered the growth of renewables, as confirmed by the Center for Global Sustainability, which estimates that Indonesia will require $65 billion in investment between 2025 and 2030 to successfully scale its clean energy infrastructure—rising to over $1 trillion by 2060.

Also Read: China Clean Energy Future: A Global Leader in Renewable Revolution in 2024. 

Opportunities: Green Jobs, Public Health, and Economic Growth

The potential rewards for Indonesia’s energy transition are substantial. According to the Center for Global Sustainability, advancing renewables could:

• Generate up to 28.1 million green jobs by 2060
• Lift millions out of poverty
• Reduce air pollution and improve public health
• Cut national healthcare costs

“To meet its climate targets and global commitments, Indonesia must adopt strong policies to phase out coal and accelerate renewable energy,” said Jiehong Lou, Assistant Research Director at CGS. The Just Energy Transition Partnership is cited as a vital financial mechanism supporting this transformation, particularly in the retirement of coal plants.

Call to Action: Streamline Policy, Empower Investment

Experts and advocates urge policymakers to streamline regulations, boost incentives, and create more certainty for investors. The next five years are viewed as decisive for Indonesia’s energy transition, with the need to balance inclusivity, economic growth, and climate responsibility. Expanding renewables is not just an environmental imperative—it is increasingly a matter of national competitiveness in a rapidly decarbonizing global economy.

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