Jakarta. The Institute for Essential Services Reform (IESR) on Friday warned that Indonesia’s plan to build 100 gigawatts (GW) of solar power capacity will depend not only on massive investment, but also on improvements in procurement systems, land readiness, and renewable energy regulations.

Speaking at a media briefing in Jakarta, IESR said the government must build a faster, more transparent, and more bankable system to accelerate solar project development.

“The transition away from diesel power needs to be accelerated through the procurement of solar power plants that are more transparent and efficient, supported by practical tariff regulations to make solar energy investments more attractive,” IESR CEO Fabby Tumiwa said.

IESR identified Indonesia’s diesel reduction program as one of the main opportunities to accelerate solar deployment. Under PLN’s 2025-2034 Electricity Supply Business Plan (RUPTL), the state utility plans to cut diesel-generated electricity supply by 80 percent by 2030, targeting around 3,996 diesel generators across 1,234 remote locations.

However, procurement for diesel replacement projects has faced repeated delays. A 2022 bidding process reportedly drew limited investor interest, while follow-up consortium plans in 2023 ran into tariff approval problems.

IESR said procurement mechanisms need to be redesigned to make projects more attractive and financially viable. The group proposed bundling smaller regions into larger project packages to improve economies of scale and reduce logistical costs.

The organization also highlighted opportunities to reduce fuel consumption through programs integrating solar power plants and battery energy storage systems (BESS) into larger grids still dependent on diesel generators.

PLN’s annual fuel consumption remains high at around 4 million kiloliters, making solar and battery integration a potentially major cost-saving strategy if supported by clear tariff and procurement rules.

IESR also urged the government to immediately issue tariff regulations for hybrid power plants to support wider solar deployment.

Meanwhile, experts said Indonesia could learn from Vietnam, which has Southeast Asia’s largest installed solar capacity at around 18.66 GW, compared with Indonesia’s roughly 1.49 GW.

“Vietnam has demonstrated that rapid solar expansion can be achieved in a short period when supported by strong policies, regulatory incentives, and a ready electricity grid,” said Eko Adhi Setiawan, senior lecturer in Energy Systems Engineering at the University of Indonesia.

He said Indonesia should focus not only on headline capacity targets but also on building technically and financially viable projects that can later be expanded at scale.

The warning comes as the government accelerates preparations for President Prabowo Subianto’s solar energy push. Deputy Energy and Mineral Resources Minister Yuliot Tanjung said the government has started preparing around 24,000 hectares of land across Java for large-scale solar power plant development.

Yuliot said land availability remains one of the main obstacles in accelerating the 100 GW solar program. The government is targeting up to 100 GW of installed solar capacity by 2029, with estimated investment needs reaching around $100 billion over the next three years.

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