Indonesia sets 3.3 GW target geothermal installed capacity by 2030
With a target of 3.3 GW installed geothermal power plant capacity by 2030, Indonesia is implementing several strategies to accelerate geothermal development in the country.
During the 8th Indonesia International Geothermal Convention & Exhibition (IIGCE) 2022, Minister of Energy and Mineral Resources Arifin Tasrif announced that the Indonesian government through the General Plan for the Provision of Electricity has set a geothermal development target of 3.3 GW installed capacity by 2030.
To attain this target, the government is implementing several strategies including a government drilling program, providing geothermal funds, synergy with state-owned enterprises, and optimizing resources. According to Arifin, access to funding and the use of technology are highly critical in geothermal development.
Indonesian Geothermal Association (INAGA) Chairman Prijandaru Effendi said that the business sector is ready to push the target to an installed capacity of 17 GW by 2030. However, regulatory support will be needed to reach this target. Prijandaru mentioned how geothermal development is currently not optimal, considering that the capacity is only growing at a rate of 60 MW per year.
Another way to attract investments into geothermal projects is to reduce the risk of drilling failures by providing appropriate funding schemes. Currently, the largest source of funding for geothermal projects is still company equity. Prijandaru mentioned that local financing agency PT SMI now has a financing scheme but is only granted to state-owned enterprises. “We are waiting for the same scheme to enter the private sector,” said Prijandaru.
The recently announced Presidential Regulation is a positive step in the acceleration of the geothermal industry in Indoneisa.