Indonesia has ambitious goals to cut its greenhouse emissions and move into becoming a low carbon economy by putting to use its vast resources in renewable energy. With clear targets set for 2025 to diversify its energy mix, the sector holds wide ranging opportunities for investment.
Indonesia’s electrification ratio still remains low relative to the rest of the region and a key area of focus for the country’s infrastructure development. This article looks at the electricity sector in depth and the opportunities available to investors, particularly within renewable energy.
Once an OPEC member and the world’s leading LNG exporter, Indonesia is now a net oil importer and has lost its position in LNG to Qatar. This section covers the outlook for oil and gas as domestic energy demand continues to rise in line with development.
Investment in exploration of new blocks to compensate for ageing oil and gas fields has been slow to come forward and thus output has seen a steady decline for oil in particular. This section looks at what has held back investors and the challenges that lay ahead for the sector.
Indonesia has the largest proven reserves of geothermal energy in the world and is aiming to become the largest producer of it over the next decade. This section looks at some of the challenges in the sector that have held back development and the recent regulatory changes to boost it.
Indonesia’s domestic electricity demand is increasing at an average of 9% annually thus pressing the need for accelerated development of its geothermal resources. This section looks at how investors can enter the sector and the legal framework governing the industry.
While being a relative newcomer to the coal industry, Indonesia is well positioned to serve the energy hungry markets of Japan, India and China. This section looks into how the country is meeting the growing domestic consumption alongside demand for exports.
Contribution to GDP: 8% (2011)
Imports: $40 billion (2011)
Proven Oil Reserves: 4.2 billion barrels (2011)
Proven Gas Reserves: 109 trillion cubic feet (2011)
Proven Coal Reserves: 28 billion MET (2012)
Proven potential in Geothermal Energy: 28 GW
Proven potential in Hydropower: 75 GW
Other Energy Sources: Coal Bed Methane, Solar, Biomass, Sea Current Energy.
Current Energy Mix: Oil 47.6%, Coal 26.3%, Gas 21.4%, Hydro 3.2%, Geothermal 1.5% (2011).