Deputy chairperson for Maritime Affairs, Investment, and Foreign Affairs of the Indonesian Chamber of Commerce and Industry (Kadin), Shinta Widjaja Kamdani, says that Indonesia has investment opportunities and potentials in the renewable energy sector, being the second largest country with NBS (Nature Based Solutions) in the world after Brazil of up to 1.5 GtCO2/year.
“Indonesia has renewable energy resources totaling 3,686 GW, consisting of solar power totaling 3,295 GW, hydropower 95 GW, bioenergy 57 GW, wind power 155 GW, geothermal energy 24 GW, and ocean energy 60 GW. However, of the total capacity of 3,686 GW, only 12.54 MW has been utilized,” Shinta said while addressing a meeting with Assistant Secretary of the US Treasury, Alexia Latortue, discussing opportunities and challenges in green investment through renewable energy sector in Indonesia as quoted on Thursday, July 11, 2024.
“By developing this potential, Indonesia could have more than 1.1 terawatts of renewable energy capacity and could become a leader in the global transition
to renewable energy,” she added.
Chairman of the Energy Transition Working Group of Kadin Indonesia, Anthony Utomo, said that the US investment can open up more space for increasing renewable energy capacity, developing green technology, and attracting other countries to participate in investing in Indonesia in the EBT sector.
However, there are several challenges that need to be overcome, such as infrastructure that needs to be improved, supporting regulations, and the readiness of adequate human resources.
“Therefore, we will bridge and bring together the various key stakeholders in the renewable energy sector to work together to implement innovative and sustainable solutions,” Anthony said.
He cited that Kadin’s Energy Transition Working Group has prepared three key initiatives to help prepare Indonesian companies to attract local and global investors, namely:
- Encouraging the Implementation of the Green Development Initiative:
This effort focuses on developing a strategy towards a sustainable green industrial ecosystem with the use of clean energy, both from a local and global perspective. - Develop Renewable Energy Manufacturing:
This effort aims to support domestic supply chain technology independence, especially in supporting the development of clean energy in Indonesia in accordance
Indonesia’s local content roadmap. - Accelerating Distributed Energy: This effort aims to accelerate energy distribution or utilization of independent clean energy generators for industrial consumption, as well as encouraging the use of clean energy through various innovative solutions provided by our members.
“Through these initiatives, Kadin’s Energy Transition Working Group is optimistic that it can help improve the competitiveness of Indonesian companies and create added value in the eyes of local and global investors. The investment made by the United States is proof that Indonesia has promising investment potential in the EBT sector,” Anthony said.
Indonesia is the largest recipient of green investment in Southeast Asia by 2023, with a total of nearly 20,000 green investments, totaling nearly US$1.6 billion,and invcrease of 28 percent over the previous year.
With this figure, Indonesia accounts for 25 percent of total investment in Southeast Asia. By 2023, the United States has also invested in Indonesia for US$500 million in solar panel and solar module manufacturing. The United States is the sixth country with the largest investment realization in Indonesia, where its investment value reached a total of US$9.4 billion during the period 2018 to the first quarter of 2023. Of the total investment realization, there were 5,683 projects that managed to absorb a workforce of 82,299 people.
