Rethinking Energy for a Sustainable Future
By Kamaruddin Azis
The COMMIT Foundation
PELAKITA.ID – Indonesia stands at a defining crossroads in its energy history. The nation’s transition from fossil fuel dependency toward renewable energy is no longer just a policy choice — it is an existential necessity.
Guided by Law No. 30/2007 on Energy and an ambitious goal to achieve Net Zero Emissions by 2060, the country aims to reshape its energy system into one that is cleaner, fairer, and more resilient.
For those of us working in civil society, especially in organizations like The COMMIT Foundation, the energy transition is not only about technological transformation but also about social inclusion — ensuring that no community is left behind in this shift toward sustainability.
The Current Reality: Heavy Reliance and Uneven Progress
As of 2025, coal still dominates Indonesia’s energy mix at nearly 38%, followed by oil and gas. Renewables account for only 16%, far below the 23% national target for 2025. Despite vast natural potential — over 3,600 GW of renewable energy across solar, hydro, wind, and geothermal sources — only 0.4% has been utilized.
This reality reveals a deep challenge: while Indonesia is rich in natural energy potential, its infrastructure, regulatory environment, and financing mechanisms remain underdeveloped.
Fossil fuel subsidies continue to make coal and oil cheaper than renewable alternatives, slowing the shift toward cleaner energy.
Policy Progress and National Frameworks
The government has shown increasing commitment through new policies such as:
Government Regulation No. 40/2025 on National Energy Policy
The issuance of Government Regulation No. 40/2025 marks a major renewal of Indonesia’s national energy framework. It sets the foundation for a more regionally integrated, equitable, and sustainable energy system.
This regulation not only reaffirms the country’s commitment to expanding renewable energy but also embeds industrial downstreaming—or hilirisasi—within the national energy strategy.
Presidential Regulation No. 109/2025 on Waste-to-Energy Management
The Presidential Regulation No. 109/2025 provides a long-awaited framework for turning urban waste into renewable energy. It sets clear technical standards, licensing procedures, and environmental safeguards for Waste-to-Energy (WtE) projects across Indonesian cities.
Ministerial Regulation No. 2/2024 on Rooftop Solar PV
Ministerial Regulation No. 2/2024 introduces a standardized framework for the development of rooftop solar photovoltaic systems across the country. It clarifies technical requirements, grid interconnection procedures, and customer rights—making it easier for households, businesses, and public institutions to install solar panels and connect them to the grid.
Ministerial Regulation No. 5/2025 on Renewable Power Purchase Agreements
With the release of Ministerial Regulation No. 5/2025, Indonesia takes an important step to strengthen investment certainty in renewable energy. The regulation provides clear guidance on Power Purchase Agreements (PPAs), outlining standardized terms, risk-sharing mechanisms, and tariff principles for renewable energy projects.
These frameworks mark a turning point, but implementation remains uneven — especially across Indonesia’s vast and diverse island regions.
Challenges: From Policy to Practice
From the perspective of an NGO worker involved in community-based renewable projects, such as Seaweed for Net Zero Emission Solutions, PMDM and PPM SDGs PT Vale, and GIZ – Energy Villages in South Sulawesi few years ago, several recurring challenges stand out:
Infrastructure Gaps
Indonesia’s renewable energy expansion faces one of its most fundamental challenges in infrastructure. The national grid, still largely designed around centralized fossil fuel systems, has limited capacity to absorb intermittent sources such as solar and wind.
Many remote and island regions remain off-grid or poorly connected, creating technical and logistical barriers to renewable integration. Without significant investment in transmission, storage, and smart-grid technologies, much of Indonesia’s vast renewable potential will remain untapped.
Financing Barriers
High upfront costs for renewable projects—especially solar, geothermal, and bioenergy—remain a major deterrent to private sector involvement. Investors often face long payback periods, uncertain tariffs, and limited access to affordable green financing.
While public incentives and climate funds exist, they are not yet sufficient to close the financing gap. This underscores the need for blended finance mechanisms, where government, private sector, and international partners share the risks and rewards of Indonesia’s energy transition.
Regulatory Delays
Complex licensing procedures and inconsistent policy enforcement have slowed the pace of renewable energy deployment. Developers frequently encounter overlapping authorities and unclear land-use regulations, leading to project delays and cost overruns.
These issues weaken investor confidence and discourage long-term commitments. Streamlining permitting processes, harmonizing regulations across sectors, and ensuring policy stability are therefore crucial steps for sustaining momentum in clean energy development.
Social Equity Issues
Beyond technical and financial hurdles, the human dimension of the energy transition requires serious attention. Coal-dependent regions—such as parts of South Kalimantan and East Java—risk economic dislocation as fossil fuel operations decline. Without inclusive, “just transition” policies, thousands of workers and local economies could be left behind.
These are not merely technical or financial issues. They reflect a larger question about how inclusive our transition truly is.
Sulawesi: The Living Laboratory of Energy Transition
In Eastern Indonesia, Sulawesi serves as a model for renewable energy development. With a potential of over 216 GW, including 60 GW in South Sulawesi alone, the region is emerging as a clean energy hub.
Projects such as solar facilities in Takalar and Pangkep illustrate how decentralized, community-driven approaches can thrive in archipelagic settings.
At the same time, the region faces the complex paradox of progress: while Sulawesi leads in renewable innovation, it is also home to intensive nickel mining operations, critical for global electric vehicle batteries but posing environmental and social risks.
This duality underscores the need for sustainable mining and transparent community engagement.
The Role of Civil Society: Bridging Policy and People
Civil society organizations and NGOs play a critical role in ensuring that Indonesia’s energy transition is just and inclusive. From promoting local ownership of solar installations to facilitating policy dialogues between communities, academia, and government, NGOs are the connective tissue in the nation’s clean energy movement.
Our experience at The COMMIT Foundation shows that when communities co-own energy projects — whether rooftop solar or biogas systems — they gain more than electricity. They gain agency, skills, and confidence to shape their future.
Opportunities Ahead: Collaboration and Innovation
Despite the challenges, Indonesia’s renewable future looks bright. Opportunities lie in:
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Local and regional initiatives that match the country’s archipelagic geography.
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Public–private–academic partnerships that accelerate innovation.
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Global climate financing and investment in green industries.
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Decentralized energy models that empower villages and small islands.
Collaboration is the keyword. Government, private sector, academia, media, and civil society each hold pieces of the same puzzle — a sustainable Indonesia.
Lessons from the Islands
From years of engagement across Indonesia’s islands, several lessons emerge:
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Potential is vast, but utilization remains low.
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Sulawesi’s leadership in clean energy can guide Eastern Indonesia’s future.
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Investment and innovation must go hand in hand with community inclusion.
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The transition is not just ecological—it’s economic and social.
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Civil society participation ensures fairness, transparency, and accountability.
Conclusion: From Transition to Transformation
“The energy transition is not merely about changing our resources, but about redesigning our nation’s future toward independence and sustainability.”
Indonesia’s journey toward clean energy is both a challenge and a calling. The real transition happens not only in power grids and regulations but in the minds and actions of people — from policymakers to local fishermen installing solar panels on their fish ponds in Makassar.
For NGOs like The COMMIT Foundation, this transition represents the very heart of development: empowering communities to become architects of a greener, more resilient, and more inclusive Indonesia.