Indonesia, renowned for its abundant natural resources, stands on the brink of becoming a regional leader in the green energy sector. The archipelagic nation boasts an estimated technical potential of 400 gigawatts (GW) for renewable-based power generation, laying a robust foundation for a sustainable energy future.
Solar energy emerges as a dominant player, constituting half of Indonesia’s renewable potential. Additionally, hydropower and geothermal sources hold significant promise, with capacities reaching up to 75GW and 29GW, respectively. The cumulative potential, if fully harnessed, exceeds the country’s future energy demands. However, the pace of this energy transition requires careful management to ensure an equitable and just transition.
This optimistic outlook underscores Indonesia’s substantial green energy prospects, with renewables projected to contribute up to two-thirds of the nation’s total energy mix by 2050, a significant leap from the current 14 percent.
Indonesia also emerges as a potential hub for carbon capture and storage (CCS), with estimated storage potential ranging from four to eight gigatons of carbon dioxide (CO2) by utilizing depleted oil and gas reservoirs. Leveraging saline aquifers could further amplify CO2 storage potential by an additional 600 billion tons. This presents a transformative opportunity for Indonesia to expedite the reduction of national CO2 emissions.
Moreover, Indonesia positions itself as a key player in the production of green molecules. As an emerging economy with a burgeoning industrial sector, there is a growing demand for industries like steel, cement, and chemicals to transition to green hydrogen for accelerated decarbonization. Projections indicate that the demand for green hydrogen across Asia could surpass 300 million tonnes per annum by 2050, positioning Indonesia at the forefront of this pivotal shift in the energy landscape.