Indonesia’s renewable energy sector attracted unprecedented investment in 2024, with $6.2 billion committed to projects across solar, wind, hydro, and geothermal technologies. ProSpace Indonesia’s Energy Investment Report reveals this represents a 78% increase compared to 2023 figures.
Solar power leads growth with 2.8 gigawatts of new capacity under development, primarily through utility-scale projects in Eastern Indonesia. Meanwhile, the country’s first major offshore wind project broke ground off North Java, set to deliver 1.2 gigawatts upon completion in 2027.
“Indonesia is reaching a tipping point where renewable energy is not just environmentally preferable but economically advantageous,” explains Rina Wijaya, Energy Transition Analyst at ProSpace. “Declining technology costs, supportive policies, and corporate sustainability commitments are creating ideal conditions for accelerated deployment.”
The government’s updated energy mix targets aim for 35% renewable generation by 2030, up from the previous 23% target. Power purchase agreement terms have been standardized and streamlined, reducing negotiation timeframes by an average of 8 months.
International climate finance plays a significant role, with Indonesia securing $3.5 billion through Just Energy Transition Partnership arrangements. Meanwhile, domestic banks have expanded green lending portfolios by 124% in two years.
Challenges include grid integration capabilities and land acquisition processes, which government initiatives are addressing through infrastructure upgrades and regulatory reforms.
For renewable energy insights: Phone: +62 21 5799 8989 Email: info@prospaceindonesia.com Follow @prospace.indonesia on Instagram for updates