Jakarta, 10 March 2023 – Clear and earnest support from the government for the development of solar energy needs to be demonstrated, especially in achieving the Net Zero Emission (NZE) target in 2060 or sooner and the renewable energy mix target in the Just Energy Transition Partnership (JETP) of 34 % in 2030.
“So far, JETP discussions are still focused on the early retirement of the coal-fired power plants (CFPP). There is no element of accelerated renewable energy yet. It needs to be noted, especially to accelerate the development of solar energy, which is projected to become one of the backbones of electricity generation in achieving the NZE, given Indonesia’s great potential, increasingly competitive economy and relatively short construction,” said Daniel Kurniawan, Researcher, Specialist Photovoltaic Technology and Materials, Institute for Essential Services Reform (IESR) in the Solar Energy Talk: Technology, Policy and Solar Energy Challenges in Supporting the Just Energy Transition Partnership (JETP) and Net Zero Emission (NZE) on Thursday (9/3/2023).
According to him, nowadays is the right time for the government to involve community participation by pursuing these various targets with policies that support the acceleration of solar energy and the use of rooftop solar power plants on a commercial & industrial and residential scale. He regretted that the public hearing held by the Ministry of Energy and Mineral Resources (MEMR) regarding the revision of Minister of Energy and Mineral Resources Regulation No. 26/2021, the government wants to cancel the net metering scheme for the residential sector, which will reduce the economy and customer interest in installing rooftop solar PV.
“The government should not remove policy support for the community in adopting rooftop PV mini-grid, especially for the household and the small business sector, at this very early adoption stage. On the other hand, policy support must be increased to encourage adoption to a mature market stage,” he stressed again.
On the same occasion, Widya Adi Nugroho, Sub Coordinator for Supervision of Renewable Energy Businesses, Ministry of Energy and Mineral Resources (MEMR), said that Indonesia has a renewable energy mix target of 23% in 2025. However, until 2022 it has only reached around 12.3 %. He said the utilization of new renewable energy power plants was prioritized according to the planning of the Electricity Supply Business Plan (RUPTL).
“Based on the 2021-2030 RUPTL, solar energy will increase by 4.6 GW in 2030. Solar will be the backbone of Indonesia’s electricity reaching 461 GW in 2060. In addition, the price trend for solar PV is getting lower and more competitive. Likewise, supporting components such as batteries so that development opportunities are increasingly open. However, there are challenges in developing solar PV, one of which is that the room for electricity generation is still full, so it requires community participation as consumers and producers to utilize renewable energy through solar energy. In addition, the system needs to maintain intermittent conditions, both with backup generators that can compensate for solar PV and also related to the local content requirement (LCR),” explained Widya Adi Nugroho.
Anindita Satria Surya, Vice President of Energy Transition and Climate Change, State Electricity Company (PLN) explained, his party continues to implement energy transition initiatives to achieve net zero emission (NZE) in 2060 or sooner. For this reason, it is necessary to increase internal capabilities and technology supported by innovation, policy and finance. Anindita estimates that the investment needed to reach the NZE in 2060 is around USD 700 billion. In addition, Anindita emphasized that the implementation of the de-dieselization program or the conversion of diesel power plants is a strategy to increase the energy mix, especially solar energy in the electricity system.
“There are several PLN strategies for integrating renewable energy, including in the short term achieving RUPTL (2021-2030) with around 4.7 GW or 22% coming from solar PV,” said Anindita.
In his presentation, other renewable energies that will be developed to achieve RUPTL include hydropower (44%) and geothermal (16%). In addition, his party will carry out de-dieselization, early retirement of coal, and co-firing of biomass. Then, in the long term to achieve NZE (2031-2060), steps to be taken include encouraging battery-based electricity storage and interconnection, as well as hydrogen co-firing. On the technology and ecosystem development side, PLN will focus on, among others, solar PV and electric vehicles.
“As an illustration, in the beginning, we built a powerful system, namely the baseload generator, built a strong transmission and coupled with strengthening the use of renewable energy, including solar PV. At the end of the 2035 period, most of the solar PV has entered our system,” he said.
Anindita emphasized that solar PV could be one of the solutions to increase the energy mix but the readiness of the infrastructure, especially batteries, to reduce intermittent nature must also be seen. For example, there are no batteries to support solar PV in Lombok, West Nusa Tenggara (NTB). Not only rooftop solar PV, but PLN is also trying to take advantage of the potential of floating solar PV. As part of supporting the implementation of the Indonesian Presidency’s G20 activities, a 100 kWp floating PLTS has been built in the Muara Reservoir, Nusa Dua, Bali.
Meanwhile, Rosyid Jazuli, a researcher at the Paramadina Public Policy Institute, explained that Indonesia has enormous solar potential. Unfortunately, currently, more than 60% of electricity in Indonesia still comes from coal. This is due to several challenges in implementing solar energy to support the implementation of the Just Energy Transition Partnership (JETP), such as unclear plans, overlapping regulations, and potential funding in the form of loans. Rosyid suggested that there should be coordination between ministries and agencies in supporting the implementation of JETP, considering that this issue is a complex matter.
“On the other hand, the potential for green funding, which reaches USD 20 billion should also be optimized, especially since the current world trend is towards sustainable development. Funding is also needed for research and development of solar energy and the potential to attract investment in solar power,” said Rosyid.
Solar Energy Talk 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), Persatuan Pelajar Indonesia (PPI) Australia, Asosiasi Peneliti Indonesia Korea (APIK), Institut Energi Surya Generasi Baru (Insygnia), and Solarin.
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 the Net Zero Emission (NZE) target.***