Jakarta – The Indonesian government estimates that Rp 1,000 trillion is needed in the next 10 years to increase power generation capacity by 47 gigawatts (GW) from renewable energy and build transmission networks and substations.
“Of the total need, around Rp600 trillion will be allocated for power plants, while the other Rp400 trillion is for the development of transmission networks and substations,” said Deputy Minister of Energy and Mineral Resources (MEMR), Yuliot Tanjung, in an official statement at the Electricity Connect 2024 forum, Wednesday, November 20.
According to Yuliot, PT PLN (Persero) alone cannot bear such a large investment. The government is preparing various cooperation schemes with the private sector and government intervention.
“Some projects can be carried out by PLN, some by private partners, and some through direct support from the government. All of this is being studied to ensure optimal implementation,” he explained.
Private sector role in transmission network
Currently, PLN is still the primary responsibility for developing electricity transmission networks. However, due to the slow progress of relying solely on PLN, the private sector’s involvement in the development of this infrastructure is increasingly being discussed. In recent years, intensive discussions have been held to open up opportunities for private investment, including in constructing transmission networks.
“If we rely only on PLN, accelerating transmission development will be difficult. Therefore, the involvement of the private sector and the government is crucial,” Yuliot added.
Meanwhile, the Director General of Electricity of the Ministry of Energy and Mineral Resources, Jisman Hutajulu, emphasised that the need for electricity networks over the next 10 years will reach more than 50,000 kilometres (km). This figure will continue to increase to 74,000 km by 2040.
“We are currently mapping out transmission development priorities because PLN’s ability is limited. The government’s role will be very helpful for strategic infrastructure such as substations and transmission networks,” he said.
Massive infrastructure planning
PLN President Director Darmawan Prasodjo explained that the shift in energy development strategy from fossil-based to renewable-based requires massive infrastructure planning. He also noted the mismatch between the location of renewable energy resources and centres of electricity demand, such as industrial areas.
“This mismatch requires large transmission and substation designs. In our simulation with the Ministry of Energy and Mineral Resources and the International Energy Agency (IEA), we need around 53,000 km of transmission over the next 10 years. This figure will jump to 70,000 km by 2040,” Darmawan explained.
He added that this transition is a national priority to support economic growth, household sector electrification, and the development of an electric vehicle ecosystem in Indonesia.
“Indonesia has committed to placing EBT as the backbone of energy development. Although the challenges are great, we are optimistic that this target can be achieved with the involvement of many parties and regulatory support,” he concluded.
The government will focus funding on areas with high economic growth potential and electricity demand centres. The financing scheme involves public-private partnership (PPP) mechanisms and international cooperation programs.
The Electricity Connect 2024 forum is a critical moment to unite the views and strategies of various stakeholders in realising Indonesia’s electricity future based on clean energy while simultaneously answering the challenges of increasing electricity demand. (Hartatik)
