Jakarta—Indonesia must strengthen its domestic industry’s ability to produce large quantities of solar cells and modules to achieve electricity infrastructure independence and support the clean energy transition. This was stated by the Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, in his speech at the Indonesia Solar Summit (ISS) 2024, held on Wednesday, August 21.
During the event, Luhut emphasized that developing the domestic solar industry, including human resource capacity building, is crucial in addressing the increasingly urgent climate crisis.
“The Indonesian government, through PLN, will soon launch a 60 GW renewable energy development program,” Luhut said.
In addition, Indonesia has attracted large investments from Singapore for renewable energy development, including solar power plant manufacturing, with a value reaching USD 30-50 billion.
The National Electricity General Plan (RUKN), drafted by the Ministry of Energy and Mineral Resources (MEMR) in 2023, estimates that the installed capacity of solar power plants will reach 410-460 GW by 2060. To meet this demand, Indonesia must be able to produce large quantities of solar modules independently, including all major components such as polysilicon, ingots, wafers, and low-iron tempered glass.
According to Sahid Junaedi, Secretary of the Directorate General of Various New Renewable Energy and Energy Conservation (EBTKE) of the MEMR, various strategies have been prepared to achieve the Net Zero Emission (NZE) target by 2060, including a gradual reduction in the use of coal-fired power plants and accelerated electrification in various sectors.
“Additional power generation after 2030 will only come from new and renewable energy plants, with solar power plants being one of the backbones,” said Sahid.
Meanwhile, Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), added that the government needs to provide further support to local solar module manufacturers, especially through fiscal and non-fiscal incentives.
“If not managed well, the relaxation of the government’s recently issued Domestic Component Level (TKDN) could weaken local solar modules’ competitiveness against cheaper and higher quality imported products,” Fabby said.
Fabby also highlighted the government’s role in creating a strong domestic market to absorb local solar module production and attract large investments in the sector. He estimated that the capital expenditure to build the solar power industry’s supply chain, including polysilicon, wafers, cells, and solar modules, reaches USD 170 to 190 million per gigawatt of capacity.
On the other hand, Ollie Wilson, leader of RE100, an organization that encourages industry to use 100% renewable energy, asserted that the existence of a strong supply chain of solar power components will allow businesses in Indonesia to obtain renewable electricity at a more affordable cost.
“This will help Indonesian businesses meet their international clean energy commitments and support the achievement of NZE targets,” Ollie said.
The Indonesia Solar Summit (ISS) 2024, themed “Building Indonesia’s Solar Supply Chain to Accelerate Energy Transition and Support Green Industry,” was organized by IESR in collaboration with the Coordinating Ministry for Maritime Affairs and Investment, MEMR, and international partners such as RE100. The Summit is part of the pre-event leading up to the Indonesia Sustainability Forum 2024, which will be an important forum for mobilizing support and cooperation for Indonesia’s green energy transition. (Hartatik)
Banner photo: Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, opened the Indonesia Solar Summit (ISS) 2024 in Jakarta on Wednesday (21/8). (Source: IESR)
