Institute for Research on Economics and Society – Faculty of Economics and Business – University of Indonesia

Electricity Purchase Price Policy and Challenges of EBT Development in Indonesia

New and renewable energy (EBT) has an important role in increasing energy security and decarbonizing the global economy as a form of support for a sustainable economy. However, the development of NRE plants in Indonesia has stagnated in recent years. As of 2018, the value of NRE generating capacity in Indonesia is limited to the level of 9GW or in other words, it has only increased by 960MW from the beginning of 2015. This value is far from the NRE installation target of 45GW in 2025 and 168GW in 2050 (General National Energy Plan – National Energy Council, LCDI 2018.). In fact, Indonesia is listed as a country rich in renewable energy potential. With current technology, the potential for NRE electricity is estimated to reach 432GW (IESR, 2019).

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