The Indonesian government officially enacted Minister of Energy and Mineral Resources Regulation (MoEMR) No. 10 of 2025, outlining the Energy Transition Roadmap for the Power Sector, which marks a critical milestone in Indonesia’s commitment to building a cleaner, more sustainable energy system.

The regulation defines energy transition as the transformation from reliance on non-renewable energy sources to new and renewable energy (NRE). This shift also incorporates the adoption of low-carbon technologies and systematic energy efficiency measures, designed to gradually reduce the country’s greenhouse gas emissions in line with long-term sustainability targets.

The regulation highlights three major priorities for reshaping Indonesia’s electricity system:

• Gradual Phase-Out of Coal-Fired Power Plants (PLTU)
  The government plans a progressive retirement of coal power plants, aiming to accelerate the decarbonization of the national grid. existing assets will be optimized through innovations, such as biomass co-firing and the potential adoption of emerging carbon capture technologies (CCS/CCUS).
• Future Capacity Additions Exclusively from Renewable Energy
  All new electricity generation capacity moving forward will come solely from renewable energy sources, reaffirming Indonesia’s commitment to clean energy integration and a greener power mix.
• Introduction of Nuclear Power (PLTN)
  Recognizing the need for long-term, stable, and low-carbon energy, the government has opened the door to developing nuclear power, signaling a new era for Indonesia’s energy diversification strategy.

A key feature of the roadmap is the aggressive expansion of geothermal energy (PLTP), with a target of 22.7 GW installed capacity by 2060, equivalent to 5.1% of national generation capacity. Geothermal will form the backbone of Indonesia’s clean energy transition, seen as a stable, sustainable, and environmentally friendly energy source. Alongside geothermal, the government sets ambitious targets for other renewable technologies, such as Solar Power (PLTS): 108.7 GW, Wind Power (PLTB): 73.5 GW, Hydropower (PLTA): 70.5 GW, Nuclear Power (PLTN): 35 GW

This diversified mix highlights Indonesia’s strategy to balance energy security with carbon neutrality while positioning itself as a regional leader in renewable deployment.

Emissions Outlook and Decarbonization Pathway

The roadmap projects that Indonesia’s power sector emissions will peak in 2037 at around 599 million tons of CO2—with 433 million tons from grid-connected power and 166 million tons from captive power plants. Starting in 2038, emissions are expected to decline sharply, reaching near zero by 2058 and achieving net-zero emissions from power generation by 2059.

This structured pathway signals clear long-term visibility for investors, technology providers, and developers looking to participate in Indonesia’s decarbonization journey.

However, its execution requires navigating complex challenges:

• Coal Transition
  The retirement of coal assets will not be immediate. Existing plants may need upgrades such as biomass co-firing or costly CCS/CCUS technologies, both of which pose technical and financial hurdles.
• Supply Chains for Renewables
  Ensuring reliable and sustainable sources for biomass, solar modules, wind turbines, and nuclear infrastructure will require new supply chain ecosystems.
• Grid Interconnection
  Since most renewable resources are located outside Java and Bali—where electricity demand is highest—the roadmap emphasizes inter-island and intra-island grid interconnections to balance supply and demand effectively.

Indonesia’s Energy Transition Roadmap is more than just a regulatory framework—it is a strategic blueprint for the nation’s energy future. The challenges aforementioned open significant opportunities. The demand for innovation, investment, and expertise in renewable deployment, storage, nuclear readiness, and emissions-reduction technologies will create one of Southeast Asia’s most dynamic energy markets.

For investors and industry stakeholders, this roadmap represents a generational opportunity— the chance to participate in reshaping Indonesia’s energy landscape, aligning with global sustainability goals while tapping into one of the world’s fastest-growing energy markets.

If you, a prospective client, have further inquiries about the topic discussed above, Schinder Law Firm is one of many corporate law firms in Indonesia that has handled numerous similar matters, with many experienced and professional corporate and civil lawyers in its arsenal, making it one of the top consulting firms in Indonesia. Feel free to contact us at info@schinderlawfirm.com for further consultation.

Author:
Budhi Satya Makmur