Infrastructure & PPPs in Indonesia - Q1 2025 Update
- YOG INFRA
- 5 days ago
- 12 min read
YOG INFRA Q1 2025 insight series
INDONESIAÂ has seen notable developments in clean energy sector in last quarter, across multiple technolgies such as utility-scale solar, floating solar, BESS, containerized BESS soluations, green hydrogen, nuclear and geothermal power. It is interesting to note a sense of high confidence by international investors who have made large financial committments for such investments in the country, including G2G collaborations and TA programs from DFIs such as USAID, ADB etc. There is visible project pipeline annouced for Nusantara City and promotion of EVs in the country.
Read more about key developments in Infrastructure and PPPs in Indonesia in our latest insight.
JANUARY 2025
ADB APPROVES USD 92.6 MN FINANCING FOR INDONESIA’S GEOTHERMAL ENERGY DEVELOPMENT
The Asian Development Bank (ADB) has approved a USD 92.6 Mn financing deal to support Indonesia’s geothermal energy expansion. This funding will help expand the PT Supreme Energy Muara Laboh (SEML) geothermal facility in West Sumatra and construct a new power plant with an 83 MW capacity. ADB’s total financing package of USD 92.6 Mn comprises of USD 38.8 Mn from the bank’s ordinary capital resources; a USD 38.8 Mn syndicated ADB loan from Sumitomo Mitsui Banking Corporation with ADB acting as the lender of record; and a USD 15 Mn concessional loan from the Australian Climate Finance Partnership (ACFP).
The ACFP is a concessional blended financing facility managed by ADB and funded by the Government of Australia. It catalyzes financing for private sector climate adaptation and mitigation investments in the Pacific and Southeast Asia and addresses market and demand gaps by de-risking high-impact development projects and bringing them to the market.
Indonesia, holding the world’s largest geothermal energy reserves, currently uses only a fraction of its potential. ADB has supported multiple geothermal projects in the country since 2013, including Muara Laboh and the Sarulla geothermal power project. This deal continues ADB’s efforts to boost renewable energy capacity in Indonesia, helping to meet growing energy demands while reducing reliance on fossil fuels.
SEMBCORP PARTNERS WITH PLN FOR SOLAR-BESS PROJECT IN INDONESIA
PT Sembcorp Renewables Indonesia, a subsidiary of Singapore-based Sembcorp, has collaborated with Indonesia’s state-owned PT PLN Nusantara Renewables to launch the Nusantara Sembcorp Solar Energi (NSSE) project. Located on 87 hectares in Nusantara, Borneo, the project comprises a 50 MW solar PV plant and a 14.2 MWh battery energy storage system (BESS). Equipped with 114,420 bifacial solar modules and 126 lithium iron phosphate battery packs, the facility is expected to generate 93 GWh of renewable energy annually to power Nusantara, Indonesia’s future capital city. The city was first established in February 2022 due to the rapid sinking witnessed in the country’s current capital, Jakarta. The construction of the new capital city is expected to cost in the region of USD 35 Bn.
This marks Sembcorp’s first large-scale solar venture in Indonesia. The project aligns with the country’s renewable energy ambitions, targeting 75 GW capacity by 2040. Solar PV is expected to play a crucial role in achieving this target, with energy storage also needed to stabilize the grid and complement the ramp-up of variable energy generation.
THE GOVERNMENT OF INDONESIA ALLOCATES USD 2.99 BN FOR NUSANTARA CAPITAL DEVELOPMENT
The Government of Indonesia has approved a budget of IDR 48.8 Trn (USD 2.99 Bn) for the second phase of developing its new capital, Nusantara, from 2025 to 2029. This follows an initial investment of IDR 89 Trn (USD 5.44 Bn) from 2022 to 2024, focused on building essential infrastructure. The new budget will fund the completion of key facilities for legislative and judiciary agencies, as well as ongoing maintenance and infrastructure management.
The Nusantara Capital Authority (OIKN) also plans to implement a Public-Private Partnership (PPP) program worth IDR 60.93 Trn (USD 3.72 Bn), which includes the construction of six road projects, a 138.6 km multi-utility tunnel (MUT) in the central area, a solar power plant project, and several other investment projects. The government is also exploring the construction of apartment towers and housing projects as part of the broader development initiative.
INDONESIA’S ESDM TARGETS USD 1.1 TRN INVESTMENT FOR RENEWABLE ENERGY BY 2060
The Ministry of Energy and Mineral Resources (ESDM) of Indonesia has announced the need for USD 1.1 Trn in investments to implement its National Electricity General Plan (RUKN) aimed at transitioning to renewable energy (RE) by 2060. The USD 1 Trn will address electricity generation needs, with an additional USD 104 Bn for transmission infrastructure. The investment will support diverse energy sources, including solar, wind, geothermal, hydrogen, and nuclear.
The RUKN, updated for the 2025-2060 period, aligns with national economic and energy mix targets, replacing the earlier 2019-2038 framework. It includes strategies for electricity supply, national projections, and system development. The revised plan was formalized under Ministerial Decree No. 314.K/TL.01/MEM.L/2024, issued in late 2024, emphasizing annual investment needs of approximately USD 30 Bn to achieve the outlined goals.
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CHINA'S REPT BATTERO PLANS 8-GWH BATTERY FACTORY IN INDONESIA
Chinese lithium-ion battery manufacturer REPT BATTERO Energy Co. Ltd. has decided to invest in the construction of a battery factory in Indonesia with an intended first-phase annual capacity of 8 GWh for power and energy storage batteries and systems and battery components. When completed, the Indonesian battery factory’s activities will span research and development, manufacturing, and sales of lithium-ion batteries, battery components, modules, and battery packs.
The plant will be built by PT REPT BATTERO INDONESIA, which is 60 % owned by Infinitude International Investment Ltd., an indirect wholly owned subsidiary of the Chinese manufacturer. The shareholders of the Indonesia subsidiary will increase its capital by a total of USD 139.5 Mn. The company expects the Indonesian factory to strengthen its position in Southeast Asia, improve access to local customers and raw materials, and promote resource efficiency.
FEBRUARY 2025
PLANS ANNOUNCED TO DEVELOP 4.3 GW NUCLEAR POWER PLANTS IN INDONEISA
The Government of Indonesia has announced plans to build nuclear power plants with a combined capacity of around 4.3 GW as part of its strategy to transition to cleaner energy. Currently reliant on coal for over half of its 90 GW installed capacity, Indonesia has no nuclear facilities due to seismic risks. Plans include developing floating small modular reactors, though specific timelines were not disclosed. An earlier statement suggested nuclear operations might begin by 2036.
While nuclear power reduces carbon emissions, concerns over radioactive waste persist. The government criticized the G7’s USD 20 Bn Just Energy Transition Partnership (JETP) for Indonesia, labelling it a failed program due to minimal fund disbursement. It also confirmed that Indonesia will not phase out all coal plants by 2040, opting instead to halt new projects, maintaining its status as the world’s largest thermal coal exporter.
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UAE COMMITS USD 50 MN TO INDONESIA FOR INFRASTRUCTURE PROJECTS
The Governments of Indonesia and the United Arab Emirates (UAE) have partnered to develop USD 50 Mn for Indonesia’s reforestation efforts. The UAE’s investments also target Indonesia’s renewable energy sector, including geothermal, hydropower, wind, and solar energy projects, aiming to drive the country’s green transition.
The UAE will also assist in building 3 Mn housing units across Indonesia, with construction and financing support. Other areas of cooperation include enhancing key Indonesian ports, such as Tanjung Priok and Makassar, and fostering collaboration in defence with light arms and assault rifles co-production. Additional UAE investments cover strategic projects like the Emirates-Indonesia Cardiology Hospital, North Bali Airport development, and a mangrove research centre in Bali. These initiatives are part of a broader effort to strengthen bilateral ties and promote sustainable growth in both nations.
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PLANS ANNOUNCED TO DEVELOP THREE NEW SOLAR POWER PLANTS IN INDONESIA
The Government of Indonesia has announced plans to construct three solar power plants in East Java, West Java, and West Sumatra, with a combined capacity of 220 MWp.
Karangkates Solar Power Plant in East Java will generate 100 MWp.
Floating solar farms at Singakarak Lake in West Sumatra will contribute 60 MWp.
Saguling in Bandung, West Java, will contribute 60 MWp.
The government has signed power supply agreements with investors, reinforcing its commitment to renewable energy (RE). The initiative aligns with Indonesia’s target to increase RE’s share from 14 % to 23 % by 2029. The Cirata Floating Solar Power Plant, Southeast Asia’s largest at 192 MWp, serves as a model for these developments.
The Cirata Floating Solar Power Plant was developed as a joint project between Indonesia’s state-owned electricity company PLN and Masdar, an energy firm based in the United Arab Emirates. The project, valued at IDR 1.7 Trn (USD 104 Mn), employed 1,400 workers, providing them with valuable experience and skills in solar farm construction.
UTOMODECK GROUP EXPANDS INTO THE FLOATING SOLAR POWER SECTOR IN INDONESIA
Utomodeck Group has entered the Floating Solar Power Plant (PLTS) industry to support Indonesia’s energy transition. Utomo SolaRUV has partnered with Sungrow Floating PV, a global leader in floating solar technology. The partnership aims to enhance local content (TKDN) in floating solar technology, contributing to Indonesia’s renewable energy (EBT) mix target and strengthening its domestic manufacturing capabilities.
Utomo SolaRUV currently operates a 1 GWp solar module and floater factory in Batam and has established production facilities in Batam and Surabaya for both domestic and export markets. The collaboration with Sungrow Floating PV also focuses on technology transfer to accelerate innovation in Indonesia’s floating solar ecosystem.
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MASDAR EXPANDS RENEWABLE ENERGY COLLABORATION IN INDONESIA
UAE-based Masdar has announced plans to strengthen its partnership with Indonesia to develop renewable energy (RE) projects. The Cirata Floating Solar Power Plant in Purwakarta, West Java, has been operational since November 2023. With a capacity of 192 MWp, it is Southeast Asia’s largest floating solar facility, supplying electricity to around 50,000 households. Masdar and Indonesia’s state-owned electricity company, PT PLN, are in discussions to expand the plant’s capacity. The 6,200-hectare reservoir offers potential for increasing output beyond 1,000 MWp, with Phase II development already underway following a Joint Development Study Agreement signed in 2024.
Beyond Cirata, Masdar is working with PLN and Pertamina on various renewable energy projects, including solar, wind, geothermal, and green hydrogen. Among these initiatives is a planned 200 MW renewable energy project for Indonesia’s new capital, Nusantara (IKN), in East Kalimantan, aimed at supporting the city’s sustainability goals. These collaborations align with Indonesia’s clean energy transition objectives and strengthen bilateral cooperation in renewable energy.
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INDONESIA TARGETS 35 % RENEWABLE ENERGY
The Government of Indonesia has unveiled its updated National Power Supply Plan (RUPTL), aiming for 35 % renewable energy (RE) in its total energy mix by 2034. The plan projects 71 GW of new installed capacity over the next decade, with 70 % coming from renewables—solar (17 GW), hydropower (16 GW), and geothermal (5 GW). The remaining capacity includes 15 GW from natural gas and 5 GW from coal, which the government justifies as necessary for base-load power. The Prabowo administration has reaffirmed its commitment to achieving net-zero emissions by 2050, with no new coal plants planned beyond 2040 unless they include emission reduction strategies.
Despite Indonesia’s RE ambitions, state-owned utility PT Perusahaan Listrik Negara (PLN) has struggled to meet past targets. A report by the Institute for Energy Economics and Financial Analysis (IEEFA) highlights that PLN’s previous RUPTL aimed for 21 GW of renewables but achieved only 0.6 GW per year, far below the required 2.1 GW. Key challenges include delays in transitioning from diesel power and stalled energy transition projects. The updated plan is awaiting final government approval.
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PT CIPTA KRIDATAMA AND SUN ENERGY INTRODUCE INDONESIA’S LARGEST CBESS FOR SOLAR POWER
PT Cipta Kridatama (CK), a subsidiary of PT ABM Investama, has partnered with SUN Energy to launch Indonesia’s first and largest Containerized Battery Energy Storage System (CBESS) for solar power. Installed in Jambi, the system features a 643.8 kWp solar energy setup with a 1 MWh battery housed in a 20-foot container. Designed to power remote mining operations, the off-grid system ensures a stable energy supply, reducing CK’s carbon footprint while supporting its Environmental, Social, and Governance (ESG) goals. The project was completed in four months and provides electricity for operational facilities, including housing, a sports hall, a mosque, and a clinic.
Company leaders emphasized the initiative’s role in advancing green energy within Indonesia’s industrial sector. The system will generate 849,000 kWh of clean energy annually, cutting COâ‚‚ emissions by 660 tons—the equivalent of planting over 10,900 trees.Â
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TOYOTA UNVEILS A HYDROGEN REFUELLING STATION IN INDONESIA
Japan-based Toyota has opened a hydrogen refuelling station in Karawang (West Java), Indonesia. The company set up this facility at the xEV Center, an electrification and renewable energy learning centre for the public, inside its third plant in the city.
The new hydrogen refuelling station in Indonesia features two types of pressure systems. Toyota has installed a 350-bar pump for refuelling short-range vehicles, like a forklift, and a 700-bar pump for refuelling the Mirai, trucks, and other long-range vehicles.
Hydrogen refuelling stations are capital-intensive, and Toyota’s new outlet in Indonesia is no exception. The company invested more than IDR 35 Bn (USD 2.14 Mn) in this facility. Toyota showcased the second-generation Mirai and hydrogen fuel cell forklifts, as well as technologies like hydrogen grillers and hydrogen cartridges, at the inauguration of the new hydrogen refuelling station in Indonesia.
Toyota aims to push hydrogen as a sustainable energy source in both automotive and non-automotive industries by establishing the new hydrogen refuelling station in the industrial area of Kawarang. The Japanese automaker sees great potential in hydrogen for multiple applications, including not only transportation but also energy storage, industrial processes, and power generation.
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ORMAT BEGINS 35 MW IJEN GEOTHERMAL OPERATIONS IN INDONESIA
Ormat Technologies, a leading US geothermal and energy storage company, has started commercial operation (COD) of the first section of the 35 MW Ijen geothermal power plant in Indonesia.
This marks a milestone for the power plant in East Java with a planned total capacity of 110 MW. There is a long-term power purchase agreement (PPA) for the plant with a term of 30 years. The commissioning of the Ijen plant is also an important step for Ormat in its corporate strategy to consistently expand its global geothermal portfolio and extend its presence in Indonesia. The new power plant will be jointly operated by MCG, a joint venture between Medco Power (51 % share) and Ormat Technologies (49 % share).
Indonesia has one of the largest geothermal potentials globally, and with the geothermal targets set by the Indonesian government to expand operations in the country. Â The Indonesian government plans to install plants with a geothermal capacity of 7,200 MW (7.2 GW) by 2035, which would make geothermal energy a cornerstone of the country's renewable energy strategy. At the end of 2023, Indonesia ranked second in the world with a geothermal capacity of around 2,400 MW for electricity generation, behind the USA with around 4,000 MW.
MARCH 2025
INDONESIA’S IESR IDENTIFIES 333 GW OF VIABLE RENEWABLE ENERGY PROJECTS
A study by the Institute for Essential Services Reform (IESR) has identified 333 GW of financially viable renewable energy projects across Indonesia, out of a total technical potential of 548.5 GW. These projects include 165.9 GW of ground-mounted solar power, 167 GW of onshore wind power, and 0.7 GW of thermal power. The study highlights six key regions—Papua, Kalimantan, Maluku, South Sulawesi, West Sumatra, and North Sumatra—as the most promising for development, based on economic feasibility and equity internal rate of return (EIRR) levels. Around 61 % of the identified capacity, equivalent to 206 GW, has EIRR rates exceeding 10 %, making them attractive for investors.
Indonesia aims to increase its renewable energy share beyond 23 %, with a potential target of 50 % by 2030. The report stresses the need for technological advancements, a modernized electricity grid, clear regulations, and streamlined licensing to attract investment. Additionally, Indonesia is in discussions with the US and Russia for nuclear power technology to further reduce reliance on fossil fuels by 2036.
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INDONESIA TO DEVELOP WASTE-TO-ENERGY PLANTS IN 30 CITIES
The Government of Indonesia has announced plans to build waste-to-energy (WTE) plants in 30 cities to address waste management challenges and promote renewable energy. The initiative aims to improve waste processing efficiency and reduce environmental pollution. The government estimates that Indonesia generated 69.9 Mn tons of waste in 2023, with food waste comprising 41.6 %. Currently, a significant portion of waste is either incinerated or landfilled, leading to high methane emissions. The new WTE plants will generate 20 MW of power per city, with implementation beginning in 2029.
The government is drafting a new presidential regulation to define WTE technologies, including pyrolysis for plastic waste conversion and biogas generation from organic waste. Authorities are also considering taxation on WTE developers processing more than 1,000 tons of waste per day. To encourage private investment, the Ministry of Public Works plans to streamline regulations and adjust electricity tariffs. Public-Private Partnership (PPP) model will be used to finance future projects, reducing reliance on government funding.
VINFAST’S USD 237 MN EV FACTORY SET TO ENERGISE INDONESIA’S AUTOMOTIVE Â
Vietnamese electric vehicle (EV) manufacturer VinFast has announced plans to construct a state-of-the-art EV assembly plant in Subang, West Java, with an investment of approximately IDR 4 Trn (USD 237 Mn).
The facility, spanning 120 hectares, is projected to produce 50,000 vehicles annually. Construction is slated to commence shortly after Ramadan, with completion targeted within the year and production expected to begin by September. The plant will manufacture various vehicle models, priced between IDR 200 Mn (USD 12,000) and IDR 600 Mn (USD 35,000).
In addition to the manufacturing facility, VinFast has unveiled plans to establish up to 100,000 EV charging stations across Indonesia, reinforcing the nation’s EV infrastructure and supporting the burgeoning demand for sustainable transportation solutions.
Furthermore, VinFast is exploring investments in Indonesia’s renewable energy sector, including solar power plants in West Nusa Tenggara and wind power plants in Sulawesi, underscoring the company’s commitment to sustainable development.
This strategic investment aligns with Indonesia’s aspirations to become a regional EV manufacturing hub, leveraging its abundant nickel reserves essential for EV batteries. The collaboration between VinFast and the Indonesian government signifies a robust partnership aimed at fostering economic growth, technological advancement, and environmental sustainability.
List of key transactions - Indonesia Q1 2025
Source: YOG INFRA, Public Information
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