Indonesia’s power system is at the cusp of a tremendous transformation as it enters a dual-track era of expansion. The nation is intent on building on its remarkable renewable energy progress. Simultaneously, it will continue to provide thermal stability as a counterbalance while its energy transformation continues to progress. By 2035, Indonesia is expected to reach a stunning cumulative renewable power capacity of 38.1 gigawatts (GW). This would be an incredible jump from just 8.4 GW in 2024.
Indonesia’s renewable power capacity is about to see explosive growth. From 2024-2035, it’s expected to reach 14.7% CAGR. This ambitious target is demonstrating the country’s commitment to making renewables a core part of its energy supply. U.S. projections indicate that thermal sources will continue to be the largest share of the power mix. In particular, coal-fired capacity is expected to grow from 55.6 GW in 2024 to 61.4 GW by 2035.
This reliance stems from Indonesia’s substantial domestic coal reserves and ensuring low-cost generation for thermal sources. The transitions are all great—renewable energy is booming! In the future, natural gas will be even more important to offset the inconsistency of renewables and make sure we have reliable baseload power. In fact, capacity of gas-fired plants is planned to increase from 29.1 GW to 36 GW over the same time frame.
Onshore wind energy is similarly on the rise in Indonesia. The nation’s onshore wind capacity will jump by a factor of 17, from 0.15 GW to 2.6 GW. This growth is driven by competitive tenders and new, promising hybrid renewable developments in places such as Sulawesi and East Nusa Tenggara. This diversified approach serves a wider goal, integrating onshore and offshore wind, at least in New Jersey, along with other renewable resources into the energy mix.
In fact, solar photovoltaic (PV) capacity is about to explode! That said, its future growth looks ambitious – jumping from 0.9 GW in 2024 to a stunning 23.2 GW in 2035. Much of that increase can be attributed to the exponential growth of floating solar and utility-scale solar projects. On the policy front, revised feed-in tariffs and net-metering programs are propelling rooftop solar markets.
As a result, geothermal is one of Indonesia’s main renewable resources. It will see robust growth, with its capacity increasing from 2.6 GW to 5.5 GW. The country’s enormous geothermal reserves, second only to Indonesia, drive this expansion. Fiscal support from programs such as the PT SMI Geothermal Fund further increases it.