Jakarta, April 29, 2025 – The government has issued the 2025 National Electricity General Plan (RUKN), setting a target for the renewable energy mix in the electricity sector at 15.9 percent by 2025 and 21 percent by 2030. However, the development of renewable energy has been slow. Currently, the renewable energy mix in the electricity sector stands at only 15 percent. Moreover, renewable energy investment has stagnated at around USD 1.5–1.8 billion per year, falling short of the USD 2.6 billion target by 2024. Without a new strategy, Indonesia will face challenges in achieving its energy mix target and boosting investment in the power sector to support economic growth and the manufacturing industry.
One of the obstacles to renewable energy development in Indonesia is the structure of the electricity industry, which places PLN in control of the entire chain of generation, transmission, distribution, and sale of electricity. As a single buyer, PLN faces limitations in aggressively expanding renewable energy to meet market demand, particularly from business and industrial consumers.
RE100, the Institute for Essential Services Reform (IESR), and IEEFA view the shared use of the transmission network (penggunaan bersama jaringan transmisi, PBJT), specifically for renewable energy supplied to business and industrial consumers, as a win-win solution. This scheme is tailored to Indonesia’s electricity market structure and can support the achievement of the government’s clean energy targets while providing PLN with additional revenue through grid rental and ancillary services.
The role of PBJT in attracting renewable energy investment and adoption is detailed in the policy study Accelerating Renewables Investment in Indonesia: Shared Use of the Transmission Network.
Ollie Wilson, Head of RE100, Climate Group stated that the use of shared use of the transmission network has become a common practice in many countries. These schemes enable private corporations, including RE100 members who represent the world’s leading industries, who aim to achieve 100% renewable energy in their supply chains by 2050, to access green electricity.
“Shared use of the transmission and distribution network has the potential to rapidly increase private investment in Indonesia’s renewable future. With 130+ RE100 members operating in the country, the demand for renewable electricity is already there – what’s now needed is an energy market that can help Indonesia keep pace with neighbouring countries and enable its leading stance on coal retirement, and its Golden Indonesia 2045 vision, to become reality. In partnership with PLN, RE100 members are ready to grow the grid and create a win-win for business and government,” said Ollie Wilson.
This study proposes a renewable energy transmission network joint utilization (PBJT) scheme that aligns with existing regulations and is based on four main principles. First, direct access and distribution from generators to industrial consumers. Second, the application of fair and transparent tariffs. Third, the timely and cost-effective connection of renewable energy projects to the grid. Fourth, a clear contractual framework covering supply commitments, grid regulations, and contributions to grid balancing costs when necessary.
Fabby Tumiwa, Executive Director of IESR, emphasized that the PBJT scheme could create new revenue streams for PLN. However, PLN must also strengthen its capacity to ensure that its role as a transaction center for the shared electricity network can function optimally.
“PBJT will deliver greater long-term benefits for Indonesia. It will enhance the attractiveness of foreign investment to develop export-oriented industries and renewable power plants. These national benefits must be recognized by the government, the legislature (DPR), and all stakeholders,” said Fabby.
IESR’s study reveals that Indonesia has a technical potential of over 3.7 TW of renewable energy, with approximately 333 GW of economically viable projects. The shared use of the transmission network scheme allows the private sector to invest directly in new renewable energy projects outside PLN’s RUPTL, while also supporting the strengthening of national grid infrastructure.
Moreover, IEEFA noted that PLN could gain significant financial benefits from the PPA scheme, including up to USD 5 billion annually for power plant investments. Mutya Yustika, IEEFA’s Energy Finance Specialist, Indonesia, explained that the PPA scheme could also help close the electricity infrastructure funding gap, which is estimated at USD 146 billion.
This policy study recommends that the government incorporate support for shared use of the transmission network schemes into the New and Renewable Energy Bill (EBET) and integrate this mechanism into PLN’s business plan (RUPTL). To ensure effective implementation, several steps must be taken. First, the government should introduce an upfront fee for renewable energy developers or other parties utilizing the electricity grid. This fee would be used to finance grid upgrades and infrastructure development before projects begin operation.
Second, the government should establish a dedicated PLN subsidiary responsible for transmission to enhance cost transparency. Third, PLN needs to implement an annual quota system and develop a comprehensive renewable electricity roadmap. This will provide certainty for developers and consumers while ensuring the stability of the national grid.
By adopting these recommendations, shared use of the transmission network can become a win-win solution for the government, PLN, private power producers, and industry.
