Solar Energy Plays Key Role in Energy Transition of Power System

Alvin

Jakarta, April 15, 2023 –  A careful planning strategy is essential to encourage the use of solar energy in the electricity system.  The Government of Indonesia and PLN (the national power utility) released the new Electricity Business Plan (RUPTL) 2021-2030, which sets out Indonesia’s future power capacity by increasing the number of New Renewable Energy (EBT) generators. The target of the EBT mix in the National Electricity General Plan (RUKN) is around 23% in 2025. It was stated by Alvin Putra Sisdwinugraha, Researcher of Electricity Systems and Renewable Energy at the Institute for Essential Services Reform (IESR), in the Solar Energy Talk #3 events, the results of collaboration between Solar Scholars Indonesia (SSI), IESR, PPI Australia, Korean Indonesian Research Association (APIK), Insygnia, and Solarin.

“Referring to the RUPTL, solar energy will play an important role in Indonesia’s electricity to achieve net zero emission (NZE), while the utility-scale is still the biggest contributor. However, this is not enough for Indonesia to pursue its 2050 decarbonization target,” Alvin Putra Sisdwinugraha stated.

Several potential clusters within the RUPTL are the mining sector, the tourism sector, the fisheries sector, Solar Power Plants (rooftop solar PV), floating solar PV, and other sectors with a total capacity of up to 2.1 Giga Watt (GW). Regarding floating solar PV, Alvin said the issuance of Minister of Public Works Regulation No. 6 of 2020 is a breath of fresh air for developing renewable energy in Indonesia because it allows the use of space in reservoir/dam areas of around 5% at normal water levels. Regarding these regulations, The Ministry of Energy and Mineral Resources (ESDM) has mapped out the potential for floating PLTS of 28.4 GW, with 4.8 GW of existing hydropower.

“Although the potential is quite large, unfortunately, there are no specific technical regulations regarding the safety of the dam/reservoir. This can be reflected in the development of a floating Solar PV in Cirata, West Java, which a private developer is carrying out,” he explained.

On the other hand, to encourage the use of solar energy, the government has signed Presidential Regulation (Perpres) Number 112 of 2022 concerning accelerating the development of renewable energy for electricity supply. This regulation strengthens the government’s commitment to energy transition in achieving the NZE. One of the things discussed in the Presidential Decree, said Alvin, is that the price for electricity from PLTS is based on the highest benchmark price.

“Although it depends on the bidding scheme that will be implemented by the Government and PLN, pricing for PLTS based on the highest price benchmark is expected to provide room for more small-capacity PLTS to develop,” he remarked.

Don’t Hinder People’s Willingness to Use Clean Energy

Jakarta, 21 March 2023 – As one of the countries that participated in ratifying the Paris agreement in 2015, Indonesia is committed to reducing its greenhouse gas emissions. In 2022, ahead of the G20 Summit, Indonesia will renew its emission reduction commitment in the Enhanced NDC which targets Indonesia’s own emission reduction of 31.89% in 2030 and a renewable energy mix target of 23% in 2030.

On various occasions, solar energy has been said to be the backbone of Indonesia’s electricity system in calling for renewable energy mix targets and reducing emissions. Given its abundant technical potential, the speed of installation, and the flexibility of sizes that can be easily expanded, solar is the right choice for Indonesia’s current condition, which must increase its renewable energy mix in a short time.

Unfortunately, in the last year’s development, the support for the PV rooftop has been lacking from the electricity offtaker (PT PLN). Since 2022, PT PLN has renewed the capacity to install rooftop PV, which is only 10% -15% of the installed capacity. This limitation has an impact on the economic value of rooftop PV which becomes less attractive, both for consumers and rooftop PV entrepreneurs.

In a press conference held by the Indonesian Solar Energy Association (AESI), Association of Indonesian Rooftop PV Installers (PERPLATSI), Rooftop PV Association (APSA), Rooftop Solar Electricity Users Association (PPLSA) and Association of Indonesian Solar Module Manufacturers (APAMSI), Fabby Tumiwa , the Chairman of AESI stated that various challenges were still hindering efforts to increase solar energy in Indonesia.

“Planning large-scale solar PV in Indonesia is difficult to develop because there is no long term in the electricity system before the 2021-2030 RUPTL, the auction process is less consistent and less competitive, economies of scale are difficult to achieve because the auction is launched and on a scale of less than 20 MW, until the regulations of local content requirement (TKDN) which is not supported by the readiness of the domestic industry,” said Fabby.

The Ministry of Energy and Mineral Resources, starting in January 2023, revised the Minister of Energy and Mineral Resources Regulation No. 26/2021 concerning PLN customers installing PV rooftop. The revision of Permen ESDM 26/2021 has pros and cons, one of which was conveyed by Muhammad Firmansyah, General Treasurer of PERPLATSI, who stated that revision points such as eliminating the export-import of electricity from PV users will reduce the interest of potential customers to switch to renewable energy. Planning for a quota system per power grid system is also considered to hinder the development of rooftop PV.

“By imposing a quota for rooftop PV, it is like waiting for death to come. Because if the quota in one system is full already, customers can no longer install rooftop PV that are connected to that network,” said Firmansyah.

Yohanes Sumaryo, General Chairperson of PPLSA, stated that there is a change in the behavior of PV users. “Some of us are starting to change the rooftop PV system at home so that it is not connected to the PLN (off-grid) network, especially to avoid licensing problems and other burdensome requirements. Generally potential users are also confused by the new rules regarding settlement and new conditions such as load profiles.”

According to Yohanes, many users in cities with relatively high-power rates have started installing batteries so that they can make maximum use of rooftop PV. However, the Minister of Energy and Mineral Resources No. 26/2021 needs to be fought for to properly protect PV users.

The ESDM Ministerial Regulation No. 26/2021 has an impact on various supporting sectors for PLTS, such as the solar panel industry, which is becoming difficult to develop. Linus Sijabat, Chairperson of APAMSI, said on the same occasion that regulations related to TKDN are still a challenge for the development of the domestic solar panel industry.

“The TKDN issue in domestic industrial panels requires consistent regulation and serious implementation accompanied by financial support from the government, banks and financial institutions to improve the quality of domestic solar panels and make their quality competitive with imported solar panels,” he said.

Since 2013, APAMSI has attempted to invest in large amounts to advance the domestic solar module industry but has not been successful because the captive market and demand for solar energy in Indonesia are not yet clear.

The impact of completing the installation of the rooftop PV is also being felt by the people of Bali. Several cases stated that the community had installed the PV system according to Permen 26/2021 but could not fully use it.

“In Bali itself there are many obstacles, for example the rooftop PV installation that has been installed but not fully approved by PLN so that the installed rooftop PV system cannot be used in part, even though the community installed it according to Permen ESDM 26/2021, which is 100% of the installed power of the building,” explained Erlangga Bayu representing APSA Bali.

There are also many people who have even paid a DP (down payment) to install a rooftop PV but in the end canceled it because of the capacity limitation. Even though the community installs PV at their own expense and awareness with the motivation to save electricity costs and preserve the environment. Limiting the capacity of rooftop PV seems to be blocking the real contribution of community cooperation to achieving renewable energy targets and reducing greenhouse gas emissions.

Strengthening the Solar Energy Narrative

Jakarta, 9 March 2023 – Solar energy has the potential to be developed massively in Indonesia. The Institute for Essential Services Reform in its report entitled “Beyond 207GW” states that the technical potential of solar energy in Indonesia reaches 20,000 GW. Unfortunately, the use of solar energy is still minimal. It is noted that the installed capacity of new solar energy is around 270.3 MW until 2022.

In the talk show “Bincang Energi Surya”, the collaboration of six institutions namely the Institute for Essential Services Reform (IESR), Solar Scholars Indonesia (SSI), the Indonesian Student Association (PPI) Australia, the Korean Indonesian Research Association (APIK), the New Generation Solar Energy Institute (Insygnia) ), and Solarin, Anindita Satria Surya, Vice President of Energy Transition and Climate Change of PT PLN stated that the development of solar energy is very necessary for the development of renewable energy.

“The description of the JETP scenario is first, building a large baseload such as hydropower, second, building a strong transmission network, and third, building supporting plants such as PLTS,” he explained, explaining the big picture of PLN’s plans to build renewable energy generators in the next few years.

In addition to a comprehensive investment plan for implementing the Just Energy Transition Partnership program, the development of renewable energy generators is also guided by the RUPTL. In the 2021-2030 RUPTL, it is planned that Indonesia will have more than 50% of the energy used come from renewable energy sources. Solar energy itself is planned to increase by 4.6 GW until 2030.

Widi Nugroho, Sub-Coordinator of Supervision of Various New and Renewable Energy Businesses, Ministry of Energy and Mineral Resources emphasized that to pursue the target of a renewable energy mix of 23% by 2025, fulfillment will be prioritized with solar energy.

“For the development of NRE generators, priority is given according to the 2021-2030 RUPTL where solar will increase by 4.6 GW in 2030,” he explained.

Based on the government’s plan, solar energy will be the main pillar of Indonesia’s electricity system with a capacity of 461 GW in 2060. As Indonesia receives the Just Energy Transition Partnership (JETP) funding, it opens up various funding opportunities for renewable energy projects and technology research.

On the same occasion, Muhamad Rosyid Jazuli, Policy Researcher, Paramadina Public Policy Institute, stated that currently there is one main challenge from the policy side, namely the accumulation of a number of commitments that are not accompanied by derivative regulations so that progress towards achieving the promised commitments does not run smoothly.

“The high dominance of coal in Indonesia’s electricity system and the price of coal which is considered relatively cheaper is one of the challenges in developing renewable energy, especially solar,” explained Rosyid.

Rosyid also added that in addition to policies, public perceptions need to be developed in relation to renewable energy and low-carbon technologies so that behavior changes can occur. At present, renewable energy or other low-carbon technologies, such as electric vehicles or rooftop PV, have not become the people’s first choice. Limited information related to technology and prices that are still relatively expensive are some of the aggravating factors in society.

Bincang Energy Surya is a series of public dissemination events about solar energy. Solar energy thematic dissemination will be held regularly, every two weeks until June 2023, covering topics; Indonesia’s solar energy landscape, current policies, technology, industry, socio-economic and human resource readiness to support the Just Energy Transition Partnership (JETP) and Net Zero Emission (NZE) targets.

Solar Energy Talks: Technology, Policy and Challenges of Solar Energy in Support Just Energy Transition Partnership (JETP) and Net Zero Emissions (NZE)

Solar Energy Talks is a series of public dissemination events about solar energy which are collectively organized by six institutions; Institute for Essential Services Reform (IESR), Solar Scholars Indonesia (SSI), Australian Student Association (PPI), Indonesian Korean Research Association (APIK), New Generation Solar Energy Institute (Insygnia), and Solarin (@solarin.id). Solar energy thematic dissemination will be held regularly, every two weeks until June 2023, covering topics; Indonesia’s solar energy landscape, current policies, technology, industry, socio-economic and human resource readiness in support of the Just Energy Transition Partnership (JETP) and Net Zero Emission (NZE) targets.

Background

As a country that ratified the Paris Agreement and affirmed its commitment to the Glasgow Climate Pact, Indonesia is committed to contributing to limiting global temperature rise. In one of the IPCC models, to limit global temperature rise below 1.5oC, GHG emissions must be reduced by 45% in 2030 compared to GHG emission levels in 2010, and reach net zero in 2050 (IPCC). In this commitment, the Indonesian government has expressed its aspirations to achieve net zero by 2060 or sooner. In addition, as a follow-up to energy transition funding agreed upon at the 2022 G20 Summit, the Just Energy Transition Partnership (JETP) secretariat has been launched by the Ministry of Energy and Mineral Resources (MEMR) which one of the main agendas is transition energy through the development of renewable energy including solar energy.

As a strategic step in achieving this target, the installed capacity of renewable energy needs to be increased quickly and massively. With potential spread throughout Indonesia, modular (can be installed at various scales), relatively short installation process, and able to absorb local skilled workforce – solar energy (solar power plants) can become the backbone of achieving renewable energy targets, reducing greenhouse gas emissions, and support Indonesia’s NZE target agenda before 2060, as well as support the JETP agenda.

Objective

  • Discuss the role of solar energy in supporting Indonesia’s Just Energy Transition Partnership (JET-P) and Net Zero Emission (NZE) targets
  • Discuss policies and implementation of solar energy policies as an effort to accelerate the energy transition
  • Discuss the energy transition roadmap, specifically solar energy, in support of the JETP and NZE targets

Driving Solar Energy Development through Gerilya

Jakarta, 1 March 2023 – The energy transition requires the participation of all parties to make it happen. The education sector is predicted to be one of the strategic pillars to ensure that there are high quality experts and technicians who are ready to take part in the realm of renewable energy development.

Secretary General of the Ministry of Energy and Mineral Resources, Rida Mulyana reminded the importance of energy transition and the use of solar energy.

“Currently, our electricity is 86% coming from fossil energy, and one day it will run out. With the energy transition, we want the quality of national energy security to increase, no longer depending on fossil energy. We have renewable energy sources, and they are abundant. This means that if we want the transition from fossil to non-fossil, the sources already exist,” said Rida at the launch of the Gerilya program, Wednesday, March 1, 2023.

Rida also added that the second urgent reason is global pressure on climate change mitigation. Weather is hard to predict, even in a tropical country like Indonesia. That is, because of global warming, due to the increasing amount of GHG emissions which then makes the earth’s temperature rise, not only does sea level rise, but the weather is also unpredictable, and that is already happening.

The Ministry of Energy and Mineral Resources specifically formed GERILYA (Solar Electricity Initiative Movement) as part of the Certified Independent Study and Internship Program (MSIB) as a result of the collaboration between the Ministry of Energy and Mineral Resources and Merdeka Belajar Kampus Merdeka, Ministry of Education and Culture-Research and Technology

In the GERIYA program, students are placed in various institutions and companies engaged in various aspects of solar energy development. In his remarks on the same occasion, Director of Various Energy and EBT, Ministry of Energy and Mineral Resources, Andriyah Feby Misna stated that energy transition efforts in Indonesia need to be balanced with the availability of competent and qualified human resources.

“For this reason, the Gerilya program continues to improve itself by improving the solar energy curriculum and re-joining the fourth batch of MSIB,” explained Feby.

The intended curriculum improvement includes, among other things, the background of the participants, which initially only came from STEM majors, but now students majoring in social and humanities can join them. The time for students to be involved in projects was also extended to four months and the briefing time was shortened to one month.

A total of 2,456 applicants from 280 universities throughout Indonesia were selected, with the result that 62 students from 34 universities were declared to have passed the GERILYA selection stage. Of the number of students who passed the selection stage, 24 people or 38% of them were women. This is a form of commitment to gender equality in the implementation of the MSIB Gerilya Batch 4 program.

 

The Institute for Essential Services Reform (IESR) has supported the Gerilya program since its first batch and provided a place for students to learn about policy changes related to solar energy development from the perspective of civil society through scientific studies. In batch 4, IESR will host four Gerilya students.

Indonesia Energy Transition Homeworks

(Jakarta, 12 January 2023) – By definition, the energy transition is an effort to change the energy supply from previously a coal-dependent source to cleaner energy. This is the effort that the Indonesian government continues to pursue to achieve national energy security and autonomy. However, there are still many tasks that must be fulfilled by the Indonesian government.

Handriyanti Diah Puspitarini, Research Manager of the Institute for Essential Services Reform (IESR) in the Ruang Publik KBR talk show: Energy Transition in Indonesia, How Far We’ve Come organized by Berita KBR (10/01) explained that the IESR report on energy transition monitors public readiness through surveys and government readiness through research.

“Bottom-up side has supported the procurement of cleaner energy, but based on the transition readiness framework studied in the Indonesia Energy Transition Outlook 2023, the government (top-down) still has many things to improve, especially in terms of commitment and regulation,” Handriyanti said.

Meanwhile, on the same occasion, Raden Raditya Yudha Wiranegara, IESR Senior Researcher stated that from the fossil fuel side, the government has not yet paid attention to carbon emissions produced by mining, oil and gas industries.

“The government only monitors carbon dioxide (CO2) emissions, which only has a fraction of methane’s heat-trapping ability, around 29-30 times less. If there is a reduction in methane gas by only 30%, it will help abate the temperature rise by 0.5°C,” said Raditya.

Handriyanti and Raditya then discussed the upward trend of buying electric vehicles. The high price then led to the government’s proposal for subsidizing these vehicles, which is expected to stimulate public demand and lower the price of electric vehicles eventually.

However, according to them, there are several points of public resistance regarding the energy transition and the use of electric vehicles. The first is the view that fossil fuels are cheaper than renewable energy.These prices are the result of government intervention in the form of price capping, subsidies and compensation. This will surely burden the state budget when global oil prices rise. Second, there is range anxiety, which means the fear of electric vehicles inability to travel long distances.

“The government then has to work around this by increasing the number of charging stations at rest areas in-between journeys,” said Raditya.

Handriyanti and Raditya discuss the government’s progress and tasks in the matter of energy transition from a techno-economic, regulatory and funding perspective. They said that the price of renewable energy technology is becoming more affordable every year, for example, the price of solar modules is 70% cheaper than 7-10 years ago and is predicted to decrease even more. Supporting Regulations such as Presidential Regulation No. 112/2021 which stipulate ministers to make a roadmap for retiring coal-fired power plants (CFPP) needs to be supported. However, the implementation of this regulation still needs to be monitored and improved, especially considering that coal and fossil funding is currently still 10 times larger than renewable energy funding.

“The presence of international forums such as the G20 has encouraged Indonesia to make commitments towards energy transition and attract financing for those efforts. It is hoped that this financing can help Indonesia achieve its target of a renewable energy mix of 23% by 2025,” they concluded.

What is Solar Energy and How is it Developed in Indonesia?

PLTS Atap

Jakarta, December 19, 2022 – The role of energy is critical for increasing economic activity and national security. Thus, energy management, including supply, utilization, and exploitation, should be carried out fairly, sustainably, optimally, and in an integrated manner. Moreover, Indonesia has ratified the Paris Agreement and submitted its commitment to reduce greenhouse gas emissions with an unconditional target of 31.89% in 2030 with its capabilities and a conditional target (with international support) of 43.2%.

Based on the Deep Decarbonization of Indonesia’s Energy System study released by IESR, Indonesia can achieve the target of the Paris Agreement being carbon neutral by 2050. This decade is essential because Indonesia must reach peak emissions in the energy sector by 2030 and reinforce a mix of renewable energy in the electricity to 45%.

Developing the renewable energy sector is a mitigation action to reduce greenhouse gas emissions (GHG) and support sustainable energy. Hence, Indonesia continues to intensify the use of renewable energy. Solar energy is one of the renewable energy choices that continue to be encouraged for its use in Indonesia.

Quoted from the Sustainable Professional Development Module for Solar and Wind Energy Conversion, Ministry of Education and Culture, solar energy is obtained by converting solar energy through specific equipment into resources in other forms. Furthermore, French scientist Edmond Becquerel discovered that certain materials would give off electricity sparks when sunlight struck in 1839. Even though the sun is located about 149 million kilometresr from the earth, its rays can be used as a renewable energy source. In solar panels, the sunlight is converted into electrical energy using photovoltaic technology (photovoltaic/PV).

Based on the Indonesia Solar Energy Outlook 2023 report issued by IESR, solar power will play an essential role in deep decarbonization in Indonesia in 2060 or sooner in 2050; at least 88% of installed power capacity will come from solar power in 2050. Unfortunately, the use of solar energy in Indonesia has only reached 0.2 GWp of installed capacity and will generate less than 1% of total electricity generation by the end of 2021.

However, Indonesia’s solar energy progress can be seen from the lower price of solar PV electricity obtained through a power purchase agreement (PPA) entered into by PT PLN (Persero) with Independent Power Producers (IPP). The cost of PPA solar PV has fallen by around 78% from US$0.25/kWh to US$0.056/kWh between 2015 and 2022. For this reason, IESR predicts that at least with the addition of large-scale solar PV projects, decreasingsolar module prices, and improving the investment climate, solar PV investment per unit prices will continue to fall, approaching the world price trend. In addition, in terms of project pipeline development for large-scale solar PV, there are currently eight projects with a total capacity of 585 MWp (which have been tendered).