Indonesia to procure 1.2GW of renewables in next decade

Out-Law News | 30 Nov 2021 | 1:52 am | 1 min. read

Indonesia’s state-owned electricity company Perusahaan Listrik Negara (PLN) will call for tenders for 21 new renewable energy generation projects over the next 10 years.

The estimated combined generation capacity of the planned projects is 1.2 gigawatts (GW), and is set out in the 2021-2030 electricity procurement plan (RUPTL), according to a local report. The projects include seven geothermal power plants with a combined capacity of 660 megawatts (MW) and six hydro power plants with 235MW capacity.

Renewables expert John Yeap of Pinsent Masons said: “It should not be a surprise that Indonesia seeks to exploit its natural resources for energy, particularly geothermal. Indonesia has one of the largest geothermal reserves globally. Sitting within the ‘Ring of Fire’, that resource, whilst significant, has been challenging to commercialise due to a combination of high exploration costs and legal complications. Nevertheless if Indonesia is to meet its net zero commitments, we should anticipate more to be done to enable geothermal resources to be used for power generation.”

Another local report said some foreign investors have shown an interest in the country’s renewable energy sector.

Indonesia plans to build power plants with a capacity of up to 41GW over the next 10 years, including 21GW of renewables generating capacity and 19.6GW of fossil fuel-based generating capacity. The plan is expected to deliver 51.6% of additional renewable generating capacity.

The country has set its goal for achieving net zero emissions by 2060. Earlier the month, Indonesian finance minister Sri Mulyani Indrawati said that the country could retire coal-fired power generation by 2040 if it gets enough financial assistance from the international community.

In May, PLN pledged to stop building coal plants by 2023 after finishing the 35GW worth of projects it had in the pipeline.