Minister of Communication and Informatics, Budi Arie Setiadi, says Indonesia could become a hub for data center industry in view of the government’s commitment to encourage the availability of infrastructure amid the projected growth of global data center market.
It is estimated that the global data center market will grow to US$39.7 billion until 2032 with an annual increase of 4.8 percent. Meanwhile, the data center market provides economic opportunity of up to US$3.37 billion for Indonesia. Being at the center of the intersection of global communication lines will give Indonesia the opportunity to become a data center business hub.
“There are similar supporting factors (investment) that we can make a benchmark for Indonesia. For example, the ease of the licensing process, the availability of infrastructure and energy, and the provision of incentives that support investment,” Budi Arie told the CNBC Indonesia Data Center Industry Dialogue on Wednesday September 11, 2024.
He emphasized the great potential of Indonesia to become a data center at the regional level.
“The government continues to make policy breakthroughs to create an investment climate that supports the growth of the data center industry, increases business competition, and responds to public needs through technological innovation,” he said.
PLN’s support
President Director of State electricity company PT PLN, Darmawan Prasodjo, explained PLN’s readiness to support the government’s target data center business growth in Indonesia.
“Our electricity today is much more reliable than four years ago. Electricity supply throughout the electricity system is now in sufficient condition. We also have renewable energy plants that can meet the needs of data centers,” he said.
“We are ready to supply electricity for data centers from at least two different substation sources. So, should there be disruption at one substation, there is still a back up electricity supply from another substation,” he added.
He said further that PLN is also ready to provide clean electricity for data centers as a service to meet customer needs for clean energy.
“We provide Renewable Energy Certificate (REC). And international institutions have been tracking the production of PLN’s clean energy-based plants that this product is also recognized at the global level. Our price is also very competitive compared to Singapore or Malaysia,” Darmawan said.
To meet the need for clean energy in the future, PLN in collaboration with the Government is preparing a plan where the addition of power plants until 2033 by 75 percent will come from new and renewable energy sources, while 25 percent will come from natural gas.
With an environmentally friendly energy ecosystem, Darmawan is optimistic that Indonesia will be able to compete with other countries in the region.
“With strong government’s support, we believe Indonesia can become a regional data center development hub, which eventually will serve as a supporter for the country’s high economic growth, job creation, poverty reduction, and people’s welfare improvement,” Darmawan concluded.
