IESR Calls for Powerful Plans to Enhance Renewable Energy Investment in Indonesia

In light of the government’s challenges in meeting renewable energy investment targets, the Institute for Essential Services Reform (IESR) has urged for more robust government policies to enhance renewable investment in Indonesia.

According to Fabby Tumiwa, the Executive Director of IESR, the recent lack of investment in renewable energy suggests that the investment climate is not conducive.

On Friday, March 21, 2025, Fabby stated, “Community rejections that occur in a number of renewable energy projects such as geothermal in Flores, Floating Solar Power Plant (PLTS) in West Sumatra, and Hydroelectric Power Plant (PLTA) increase the risk of renewable energy projects in the eyes of business actors and financing institutions.”

He stated that IESR welcomed and valued the formation of the Energy Transition and Green Economy Task Force (Satgas TEH) as per the Decree of the Coordinating Minister for the Economy No. 141/2025.

This Task Force’s existence is a demonstration of the commitment of President Prabowo Subianto’s administration to continue the energy transition agenda developed by the preceding government.

According to Fabby, the establishment of the Task Force was a good indication that the government was placing priority on Indonesia’s energy transition.

Anticipation

This Task Force is widely anticipated to hasten the energy transition in line with the goals of the Paris Agreement and to carry out the Bali Energy Transition Roadmap and Bali Compact established during the 2022 G20 Summit under Indonesia’s leadership.

“The formation of the TEH Task Force is also a form of Indonesia’s moral responsibility in implementing the results of the G20 decisions, including the nine principles of the Bali Compact and three priorities in the Bali Energy Transitions Roadmap for the global energy transition, namely ensuring energy access, increasing the use of clean and smart energy technology and encouraging renewable energy funding,” Fabby said.

IESR promotes the idea of the TEH Task Force serving as a coordination forum among ministries and government agencies to hasten the energy transition. Alongside tackling obstacles to investment in renewable energy and creating policies that provide greater backing for clean energy.

Moreover, this Task Force is anticipated to bolster Indonesia’s involvement in the execution of the Just Energy Transition Partnership (JETP) and Energy Transition Mechanism (ETM).

In order to enhance Indonesia’s credibility in managing energy transition financing within the electricity sector and to meet the Net Zero Emission target for 2050 and the electricity sector emissions target for 2030.

IESR is of the opinion that Indonesia can rapidly and economically transition from fossil fuels to renewable energy.

He stated, “Europe will soon introduce a carbon tax on goods and services entering its territory, indicating that global trade and economic development are shifting towards a low-carbon future.”

Indonesia needs to guarantee that its industry is prepared to stay competitive. The TEH Task Force is instrumental in speeding up the green economic transformation through its efforts to decarbonize the industrial sector.

Fabby clarified, “This is a vital measure to guarantee Indonesia’s sustainable economic development going forward.”

Moreover, IESR promotes the TEH Task Force’s commitment to establishing inclusive communication with a range of stakeholders, such as civil society organizations, business actors, and other elements of the private sector.