Indonesia Solar Energy Outlook 2025 highlights the crucial role of solar power in improving Indonesia’s energy security. The report analyzes how solar PV can help reduce dependence on fossil energy, improve the reliability of electricity supply, and address the challenges of climate change. ISEO 2025 also provides policy recommendations to create an environment conducive to the sustainable development of solar PV.
Indonesia Solar Energy Outlook 2025, Solar PV, Indonesia Energy Transition, Renewable Energy, Energy Policy, Solar PV Investment, Solar PV, Solar Energy Decade, Clean Energy, Energy Security, Decarbonization
This progress is part of Indonesia’s solar energy plan, which targets 5 GW of installed capacity by 2030. The growth of solar power in Indonesia reflects not just a commitment to shift away from its fossil fuel-dominated energy system but also recognises the immense potential the solar energy holds in the Indonesian archipelago.
While solar energy capacity is increasing in Indonesia, the current installed capacity is just a fraction of the potential capacity of solar power development. As a nation that straddles the equator, it gets direct, high-intensity solar irradiance, putting it in an ideal position to harness solar energy.
This translates to an estimated potential solar energy capacity that equates to approximately 112,000 GWp per day. While capturing all of this capacity is not feasible, a significant portion is in locations that remain accessible to various sizes of solar facilities. These range from off-grid micro solar plants to utility-scale, grid-connected facilities.
This potential, along with significant investment, is driving the development of solar power plants across the country. These facilities range in size, including Southeast Asia’s largest floating solar power plant – the third largest in the world.
The floating solar facility came online in November 2023 and is located in the Cirata reservoir in West Java. It currently consists of 13 solar arrays and has a capacity of 145 MW, which is enough to power 50,000 homes. Additionally, talks are underway to expand the facility to a capacity of 500 MW, and it can be expanded to reach a total capacity of 1,000 MW.
The project was a joint venture between Indonesia’s state utility company and Masdar, a United Arab Emirates-based renewable energy company. It highlights the potential for foreign companies to be involved in Indonesia’s solar power growth and signals a favourable regulatory and economic climate for investors.
The economic aspect of solar energy, particularly the cost of solar panels, plays a critical role in its adoption. This price reduction is crucial for the decarbonisation of Indonesia’s energy sector and signifies solar power’s role in the global climate transition.
Additionally, the Indonesian government recently hinted at new private-sector partnerships to build solar panel manufacturing facilities and boost the country’s quartz and silica sand production – two of the core raw materials for solar panels. This type of domestic manufacturing will help further reduce solar panel costs and be critical for the country to reach its decarbonisation goals.
Looking ahead, Indonesia’s solar energy outlook for 2024 is promising. While the country’s solar industry has historically lagged behind its regional peers, government programs are being implemented to expedite the industry’s growth. This will spur private sector involvement and drive up solar energy demand.
Additionally, neighbouring Singapore’s decarbonisation strategy relies on importing large quantities of clean energy from surrounding countries. This will further increase demand for solar energy production in Indonesia, creating a significant market opportunity and demand for solar energy capacity. Ultimately, Indonesia will need to develop 0.7 GW of solar capacity annually until 2030 to meet its own renewable energy goals – and much more when considering Singapore’s requirements.
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