Indonesia's Geothermal Potential Hindered by Infrastructure Challenges

Significant Untapped Capacity

Indonesia possesses 23.74 gigawatts (GW) of geothermal potential, positioning it as the world's second-largest geothermal reserve after the United States. Despite this significant natural advantage due to its location on the Pacific Ring of Fire, the development of geothermal energy remains constrained by infrastructure limitations.

Expert Analysis and Recommendations

Fahmy Radhi, an energy expert from Gadjah Mada University (UGM), highlights that Indonesia's geothermal potential could become a cornerstone of its renewable energy strategy. However, the lack of adequate infrastructure to access these resources remains a major obstacle. Radhi emphasizes that inter-island interconnection infrastructure is crucial to balancing supply and demand, thereby making geothermal projects more attractive to investors.

Government Plans and Projections

The Indonesian government has outlined ambitious plans in the Electricity Supply Business Plan (RUPTL) for 2025–2034, targeting the addition of 42.5 GW of renewable energy capacity, with geothermal contributing 5.2 GW. The plan projects that 70% of new capacity will come from renewable sources, aiming to achieve a more sustainable energy mix. By 2029, the government expects to have 1.1 GW of geothermal capacity installed.

Current Challenges and Global Context

Despite these plans, the realization of renewable energy targets, including geothermal, has been challenging. As of 2024, Indonesia's renewable energy mix reached only 14.68%, falling short of the 19.5% target. Globally, geothermal energy is gaining traction, particularly in the United States, where it is valued for its reliability as a carbon-free energy source. Major technology companies like Meta and Google are increasingly turning to geothermal energy to power their data centers due to its stability and low emissions.

Way Forward

To accelerate geothermal development, Indonesia needs to address infrastructure challenges through strategic planning and policy support. The government must prioritize the development of basic infrastructure and streamline regulatory processes to attract necessary investments. Without these measures, Indonesia's significant geothermal potential will remain untapped.