Accelerating the Market for Renewable Energy in Indonesia

Indonesia has the world’s fourth-largest population, a rapidly expanding economy, and an aggressive goal to increase the share of renewable energy in the country’s energy mix to 23 percent by 2025. However, the country’s remote regions and islands are largely dependent on electricity generated from subsidized, high-cost diesel fuel that is often imported and transported over long distances and challenging landscapes. At least a portion of the diesel electricity generation can be displaced by integrating electricity generated from renewable sources into the electrical grids of remote communities.

Recognizing the opportunity that the Indonesian market presents, EERE’s International Program launched the Sustainable Energy for Remote Indonesian Grids (SERIG) project in 2013 to grow the Indonesian market for American clean energy solutions and support the Indonesian government’s efforts to increase access to electricity in remote communities across Indonesia’s 6,000 inhabited islands.

Last month, the National Renewable Energy Laboratory (NREL) released a report on Sustainable Energy for Remote Indonesian Grids: Strategies to Accelerate Nationwide Deployment, which provides a set of strategies for accelerating renewable electricity deployment in Indonesia’s remote communities. The SERIG project is demonstrating U.S. renewable energy technologies and services through pilot project development and accelerating demand for renewable energy technologies on the many remote grids of Indonesia.

Earlier in the SERIG project, NREL and Winrock International conducted technical and economic analyses of renewable electricity solutions on three remote grids to serve as pilots for displacing diesel with renewable electricity. On each of the three grids, the project team determined that a different renewable resource — wind, solar, and biogas emitted from the process waste of mills that produce palm oil — was the most cost-effective solution for the local grid. The fact that three pilot grids have three different renewable solutions is a testament to Indonesia’s diverse and rich renewable energy resources.

The feasibility studies and recommendations for accelerating development of these three pilot projects are provided in NREL’s June 2015 report, Sustainable Energy for Remote Indonesian Grids: Accelerating Project Development. The SERIG project team is partnering with the U.S. Power Working Group for Indonesia — a group of American technology providers, engineering companies, and project developers organized by the U.S. Department of Commerce — to attract development of the pilot projects to demonstrate American technologies and services.

The Indonesian government recently launched an initiative to bring electricity — largely from renewable resources — to more than 12,600 villages lacking on-demand access to electricity or relying on diesel generation, including more than 2,500 with no electricity access at all. The latest SERIG report’s strategies for accelerating nationwide deployment of renewable electricity provide the Indonesian government with a path for implementation in remote communities nationwide. The SERIG project team is partnering with Indonesia’s Ministry of Energy and Mineral Resources and the state-owned electric utility Perusahaan Listrik Negara to implement these strategies.

With support from the SERIG project, Indonesia can serve as a model for clean energy deployment, especially for island nations most reliant on expensive, imported diesel fuel, while providing a growing market for advanced American technology.

This article was originally published by the U.S. Department of Energy in the public domain.

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Mark Reichhardt is International Energy Specialist for the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy International Program

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