Indonesia’s Energy Transition from Journalist’s Perspective

Peneliti Senior IESR,

The energy transition towards renewable energy is roaring in the momentum of the G20 2022. It’s because the Indonesian Government places the energy transition as one of the priority issues under its leadership at the G20. Furthermore, its coverage in the mass media, using the keyword “energy transition” on, increased from 346 in 2017 to more than 79.000 in 2022.

The Institute for Essential Services Reform (IESR) continually strives to contribute to popularizing the energy transition with various studies and advocacy activities. One of them published its main report, which encourages and measures the energy transition process in Indonesia, entitled Indonesia Energy Transition Outlook (IETO). Published annually since 2017, IETO 2023 is the 6th volume. Previously, this report was titled Indonesia Clean Energy Outlook in 2017 but changed its name to Indonesia Energy Transition Outlook in 2020.

The launch of the IETO was welcomed by various parties, including journalists in the mass media, who have a significant role to play: collecting and distributing the correct information.

Sugiharto, an ANTARA journalist, said that the IETO is a critical report that is getting better from year to year and has become a reference in journalistic writing because it contains various data and information about Indonesia’s energy transition program.

“With the IETO report with complete data, we as journalists quite often use it as a writing reference, especially regarding the diversity of data outside the government,” explained Sugiharto.

On the other hand, Sugiharto assessed that Indonesia’s energy transition development has been moderate. Even though Indonesia has a lot of renewable energy potential, that is exceptionally qualified to meet domestic energy needs. Regulatory and funding barriers are challenges for developing the energy transition in Indonesia that need to be overcome.

“Based on the low renewable energy mix, the government needs to be aggressive in realizing Indonesia’s energy transition ambitions,” said Sugiharto.

Aditya Putra, a journalist for Kompas Daily, explained the IETO, which outlines the challenges of the energy transition in Indonesia and the strategic steps in the future. Moreover, Aditya stated that these topics are interesting to be known by the public.

Researcher on Indonesia Energy Transition Outlook 2023
Researcher on Indonesia Energy Transition Outlook 2023

“The data presented in the IETO can earn attention on energy transition, including those that journalists may have missed or not disclosed regularly to the public by the Government, for example, regarding the declining mix of renewable energy in primary energy. Getting further away from the target that has been set, “explained Aditya.

In this regard, Aditya hopes that the existence of reports such as IETO 2023 can oversee the commitment and implementation of the Government’s energy transition agenda and plans. In line with Aditya, Vindry Florentin, a journalist for Koran Tempo, stated the integration of comprehensive data discussing the energy transition in the IETO report became a reference for the media. Moreover, said Vindry, the data shared by the Government needed to be completed and integrated.

Efri Ritonga, a senior journalist for Koran Tempo, also said that the development of energy transition in Indonesia continues currently, although it is still slow. Moreover, there are some community initiatives to initiate an energy transition. Such as the use of rooftop solar in residential areas, as well as the development of large-scale renewable energy, are still constrained. In addition, using fossil fuels is still dominant because of price, availability, and affordability. Some people are unfamiliar with the issue of the energy transition.

“There are several reasons the issue of the energy transition is not well known in the broad community. First, there is not much information about energy transition practices that people can start themselves with, for example, by using an electric stove, installing a rooftop PLTS, reducing the use of private vehicles made of fossil fuels, or switching to electric vehicles. Second, in terms of practicality and cost. For example, in the transportation sector, the price of electric cars is still prohibitive, and the availability of charging stations is still minimal,” said Efri and Vindry.

Opportunities are Increasingly Open for the Acceleration of Renewable Energy Development in 2023

The development of the energy transition in Indonesia

  • In general, based on the result of the transition readiness framework (TRF) made by IESR, Indonesia’s readiness for the energy transition is still low.
  • The share of renewable energy in Indonesia’s primary energy mix will decline from 11.5% in 2021 to 10.4% in 2022
  • The current share of renewable energy in the electricity mix is ​​12.8%, with a capacity of 8.5 GW.
  • In Q3 2022, investment realization was less than 35% of the target of USD 3.97 billion.
  • Energy intensity has decreased at a rate of 1.7% per year, according to the National Energy General Plan’s target of reducing by 1% per year.
  • Energy intensity in residential and commercial buildings also decreased at a rate of 1.38 % per year and 2.64 per year.
  • The government, through the Ministry of Energy and Mineral Resources, has identified that as many as 11 GW of coal-fired power plants (CFPP) can be retired early. It will be discussed further with other ministries.
  • There is increasing adoption of electric vehicles.
  • 8 out of 38 provinces in Indonesia set a renewable energy target of more than 31% by 2025
  • Financing from financial institutions for renewable energy development in Indonesia has increased but is still low compared to its portfolio.

Opportunities to accelerate the energy transition

  • Readiness for energy transition is high when viewed from the declining price of renewable energy technologies.
  • The issuance of Presidential Regulation 112/2022, if followed by the regulation that accommodates the interests of renewable energy developers, will increase energy transition readiness.
  • There will be higher installed capacity additions in geothermal, hydro and solar power plants. For example, increasing the capacity of 55 MW geothermal power plants, Peusangan and Asahan hydropower with capacities of 45 MW and 174 MW, and Cirata solar power at 145 MWac.
  • Indonesia received international funding through the Just Energy Transition Partnership (JETP), the Energy Transition Mechanism (ETM), and the Clean Investment Fund-Accelerated Coal Transition (CIF-ACT) for the energy transition in the amount of USD 24.05 billion.
  • 27 out of 38 provinces have issued local regulations on the Regional Energy General Plan (RUED).
  • The trend of biofuels is predicted to increase.


Jakarta, 15 December 2022- 2022 will close with the primary mix target for renewable energy decrease compared to the previous year. However, the presence of international support, the increase and improvement of regulations related to incentives and the renewable energy procurement process, and the existence of project pipelines that are ready to be developed can be a driving force for the accelerated growth of renewable energy in 2023.

The Institute for Essential Services Reform (IESR), supported by Bloomberg Philanthropies, has released its main report Indonesia Energy Transition Outlook (IETO) 2023, which monitors, analyzes and projects the development of the energy transition in Indonesia. The IETO report noted that the share of renewable energy in Indonesia’s primary energy mix decreased from 11.5% in 2021 to 10.4% in 2022. It was due to the share of coal increasing to an all-time high of 43%, making a target of 23% by 2025 will be difficult to achieve if the government does not immediately strengthen its political commitment to the development of renewable energy.

“There is a contrast between the ambition and the realization of renewable energy development. There is a commitment to accelerate the use of renewable energy, but there are still different perceptions and priorities of various policymakers about how the transition process is carried out. It can be seen in the decision to abolish the feed-in tariff in Presidential Decree 112/2022, the rejection of the power wheeling clause in the formulation of the new and renewable energy (EBET) Bill, as well as the decision to maintain coal subsidies in the form of Domestic Market Obligation (DMO) prices. To carry out an effective energy transition, the government must have a unified position and set no-regress targets,” said Fabby Tumiwa, Executive Director of IESR.

IETO 2023 also highlights the achievement of renewable energy investment, which is still below the target set by the government of only USD 1.35 billion by Q3 2022, only 35% of this year’s target of USD 3.97 billion. According to IESR, the investment climate needs to be improved by increasing financial support for renewable energy developers, clearer procurement processes, clear tariff schemes, shorter and clearer licensing processes, reducing barriers to entry for foreign investors, and increasing access to capital with lower interest rates.

Moreover, providing a wider space for the integration of renewable energy into Indonesia’s energy system must be carried out immediately.

“What can be done to provide space for renewable energy penetration, aside from early retirement from the CFPP, is to operate the CFPP flexibly. Technically, this operation will require changes in the main components of the CFPP. However, no less important, the flexible operation will require flexibility in terms of power purchase agreements and fuel supply contracts. According to the IEA, by making these contracts more ‘flexible’ there will be savings of 5% of the total operating costs for a year or the equivalent of USD 0.8 billion. The Grid Code also needs to be made more detailed. This is also necessary so that operators have guidelines for operating regulations flexibly,” explained Raditya Wiranegara, one of the main authors of the IETO, who is also an IESR Senior Researcher.

On the other hand, the transportation and industrial sectors are crucial for rapid decarbonization. In the transportation sector, there is an interesting trend of increasing the adoption of electric vehicles. It can be seen from the number of two- and three-wheeler vehicles which has almost fivefold increased from 5,748 units in 2021 to 25,782 units in 2022. Even so, this number is still far from the Nationally Determined Contributions (NDCs) target, which stipulates 13 million two- and three-wheeler vehicles in Indonesia. 2030.

For the adoption of electric vehicles to become more massive, the government needs to build an electric vehicle ecosystem, including building adequate charging infrastructure, increasing consumer knowledge and awareness, and providing incentives or subsidies.

“The government needs to encourage the creation of an energy transition ecosystem in all energy sectors, one of which is to create a level playing field between fossil energy and alternative low-carbon & renewable energy technologies. The first step that needs to be studied is how current energy subsidies and compensation can be diverted to providing incentives for the development of renewable energy and the adoption of low-carbon technologies while at the same time still helping to maintain people’s welfare. An interesting example is subsidies for the purchase of electric motorbikes, as an effort to divert fuel subsidies,” said Deon Arinaldo, Manager of the Energy Transformation Program, IESR.

The use of fossil energy in the industrial sector has contributed to around 20% of Indonesia’s total energy sector greenhouse gas (GHG) emissions. Increasing process efficiency and energy efficiency as well as fuel substitution have been implemented by several energy-intensive industries to reduce their emissions.

“Implementation of CCUS could be an important short-term strategy in reducing process emissions in the cement, fertilizer and steel industries, but it has yet to start. The industrial sector also needs to develop alternative low-carbon technologies, such as electrolysis-based ammonia for fertilizers and a hydrogen-based direct reduction iron-electric arc furnace (DRI-EAF) process for iron production. Currently, most of the development of low-carbon technologies in the industrial sector is still in the early stages of an MoU and a joint study agreement,” explained Raditya.

IESR encourages the government to achieve a 100% renewable energy mix in the primary energy mix in 2050 and a renewable energy mix of more than 40% in the electricity sector by 2030. If the government can take advantage of the opportunities and support mentioned above, then the attractiveness and energy mix of renewables will increase.

Published in 2017 with the Indonesia Clean Energy Outlook (ICEO) which later transformed into the Indonesia Energy Transition Outlook (IETO) in 2019. Apart from IETO 2023, which has entered its sixth edition, IESR also published it separately. Indonesia Sustainable Finance Outlook or ISFO and Indonesia Solar Energy Outlook or ISEO in 2022. Meanwhile, the Indonesia Electric Vehicle Outlook or IEVO report will be published in early 2023. ***

IETO 2023: Anticipating the Energy Crisis by Utilizing Renewable Energy

Jakarta, 14 December 2022- The global energy crisis shows the vulnerability of fossil-based energy security, including Indonesia, where 67% of the energy mix comes from fossil energy. Facing the uncertainty of social, political, economic and environmental conditions regarding national energy security, the government needs to make a sustainable and just energy transition by optimizing the use of renewable energy sources to replace fossil energy sources. This is the main discussion of the Institute Essential Services Reform (IESR) flagship report entitled Indonesia Energy Transition Outlook (IETO) 2023.

The impact of the energy crisis can be seen in energy prices such as coal, natural gas and crude oil, which have soared 2-4 times in mid-2022 compared to 2019. It has made domestic coal producers more interested in exporting overseas, which has led to a depletion of domestic coal supplies. To overcome the problem of the energy crisis in the short term, the Indonesian government made various decisions such as maintaining the Domestic Market Obligation (DMO) policy, disbursing fossil energy subsidies which reached 650 trillion and adjusting fuel prices to reduce subsidy burdens. However, coal, oil and gas reserves are decreasing every year, and the pressure to overcome the threat of the climate crisis demands a long-term solution so that Indonesia is free from an energy crisis in the future.

“To provide affordable and safe energy, increasing renewable energy for electricity supply, transportation and industry and reducing fossil energy must be accelerated. The energy transition needs to be carried out gradually following social, economic and political conditions that affect policy direction and people’s purchasing power. However, the faster we increase the renewable energy mix, the lower the vulnerability to energy security and the cheaper energy prices in Indonesia will be. It was shown in some IESR study results. The key word is ambitious but also flexible targets,” said Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), at the Media Conference for the launch of IETO 2023.

The condition of European countries and the UK, which are currently experiencing high energy prices, is an example of using transition fuels, such as natural gas, as a wrong strategy. When there is a gas shortage, they temporarily increase fossil energy which denies global efforts to reduce greenhouse gas (GHG) emissions which cause climate change due to rising earth temperatures exceeding 1.5 degrees Celsius.

IESR encourages the government to complete all homework to boost the development of renewable energy and energy efficiency quickly.

“There is still a lot of work to be done to make the energy transition truly happen and sustainable, for instance adjusting National Energy Policy (KEN) and National Energy General Plan (RUEN), phasing out coal and gas subsidies, reforming prices and electricity subsidies, accelerating the termination of coal-fired power plants, developing the domestic solar cell and module industry, adjusting the grid code, as well as integrating transportation and industrial decarbonization strategies according to the zero-emission path. The government must pursue all these reforms quickly, and the community must continue to push for the transition to occur,” explained Fabby.

IETO 2023 also highlights the high level of public awareness of the energy transition. However, in general, energy transition readiness in Indonesia is still low, although several policies, supporting regulations and renewable energy development plans have been issued, such as the enhanced NDC, RUPTL 2021-2030, which contains a 51.6% portion of renewable energy and Presidential Regulation 112/2022 concerning Acceleration Development of Renewable Energy for the Provision of Electric Power.

“Several things still need to be fixed, such as the capacity limit for installing PLTS roofs by 15%, which certainly reduces the public’s interest in utilizing this technology and contributing to the renewable energy mix on a national scale. Based on a public survey that we have conducted, more than 60% of the people we surveyed agree to accelerate the cessation of using coal as the main source in the electricity sector and support the government to start paying attention to other sources such as solar radiation, water and wind. With this huge public support, the government must begin to be able to prove its commitment to providing a cleaner source of electricity for the whole community,” said Handriyanti D Puspitarini, Main Author of IETO 2023 who is also a senior researcher at IESR.

All discussions regarding the status and analysis of the energy sector to accelerate the energy transition are summarized in the Indonesia Energy Transition Outlook (IETO) 2023. Published in 2017 with the Indonesia Clean Energy Outlook (ICEO), which later transformed into the IETO in 2019, the IETO presents several new chapters with analysis depth.

“IETO will consistently highlight, measure and provide recommendations for accelerating Indonesia’s energy transition from year to year. Several reports providing in-depth analysis on specific aspects related to the energy transition such as aspects of energy transition funding, solar energy, and electric vehicles were published in separate reports entitled Indonesia Sustainable Finance Outlook or ISFO, Indonesia Solar Energy Outlook or ISEO, and Indonesia Electric Vehicle Outlook or IEVO, which complements the IETO analysis and recommendations this year,” explained Deon Arinaldo, IESR Energy Transformation Program Manager.

Supported by Bloomberg Philanthropies, IESR will hold discussions and launch the Indonesia Energy Transition Outlook 2023 report on December 15, 2022. The IETO 2023 report can be accessed at