Indonesia’s energy sector is at a critical juncture that demands profound reforms to address the challenges of growing energy needs, energy security, and demands for sustainability. As the world’s fourth most populous country and the largest economy in Southeast Asia, Indonesia faces significant growth in energy demand along with rapid economic development and population growth. However, the national energy sector is currently still heavily dependent on fossil fuels, such as coal, oil, and natural gas, which dominate the national energy mix. This dependence not only poses risks to energy security but also makes it difficult to achieve environmental commitments, including reducing greenhouse gas (GHG) emissions as targeted by the Paris Agreement.
The Indonesian government has set ambitious targets in its energy transition efforts, namely achieving 23% of the national energy mix from renewable energy by 2025, 31% by 2030, and 50% by 2050. However, the realization of renewable energy in 2023 only reached around 13.09%, indicating that there are still many challenges that need to be overcome to achieve these targets. These challenges include policy constraints, regulatory uncertainty, infrastructure limitations, uncompetitive market structures, and lack of technical capacity and skilled workforce in the renewable energy sector.
Research Team from Purnomo Yusgiantoro Center proposes seven pillars of reform that should be the foundation for the transformation of the energy sector in Indonesia.
Download and Read the full Report “Indonesia’s Energy Sector Reform: Supporting the Energy Transition to Strengthen Energy and Economic Security”
DOI: https://doi.org/10.33116/pyc-r-1
For Indonesian version, please click here
