Indonesia Aims to Become World Leader in Geothermal Energy with Significant Resource Potential

Indonesia is poised to leverage its vast geothermal energy resources, boasting a potential output of 23,742 megawatts, which presents significant opportunities for the nation to emerge as a global leader in geothermal electricity production. Currently, Indonesia ranks second worldwide, with an installed capacity of 2,744 megawatts, trailing only behind the United States, which has 3,937 megawatts from geothermal sources.

Geothermal energy is recognized as a key renewable energy source, and as noted by Bahlil Lahadalia, the Minister of Energy and Mineral Resources, only about 10% of Indonesia's geothermal potential has been tapped, leaving a substantial 90% yet to be developed. At the Indonesia International Geothermal Convention Exhibition (IIGCE) 2025, he emphasized the need for urgent action, urging the swift auctioning of geothermal working areas in alignment with President Prabowo Subianto's directives for regulatory reform to ensure certainty and speed for geothermal investors.

To facilitate this, the Ministry of Energy is streamlining licensing processes and regulations that have previously hindered investment. In 2024, the Ministry launched a digital platform called Genesis to manage geothermal projects, enabling auctions for working areas to begin through this user-friendly interface. Minister Bahlil highlighted that complex regulations have deterred investors, leading to initiatives aimed at simplifying these processes over the past year.

Furthermore, the government's 2025-2034 Electricity Supply Business Plan (RUPTL) outlines a commitment to construct 48,000 kilometers of transmission lines to enhance the infrastructure needed for renewable energy integration. Bahlil affirmed that the current transmission network is inadequate for the energy demands, and this ambitious plan seeks to rectify that shortfall.

In a collaborative spirit, the IIGCE 2025 served as a platform for signing seven memorandums of understanding focused on education, capacity building, and commercial partnerships between state-owned enterprises, national private sectors, and international investors. These agreements aim to bolster technological investment and financing commitments, cumulatively targeting an additional capacity of 265 megawatts with a total investment of approximately $1.5 billion.

Julfi Hadi, Chairman of the Indonesian Geothermal Association, echoed the sentiment that Indonesia's geothermal potential represents 40% of the world's total reserves, yet only about 12% has been converted into electricity. To accelerate the transition to renewable energy and stimulate national economic growth, a projected budget of around $5 million per megawatt is essential for developing geothermal infrastructure.

With a target of reaching a capacity of 4 gigawatts by 2030, Indonesia is diligently working towards solidifying its position as a global geothermal powerhouse. Events like the IIGCE are crucial for fostering dialogue and collaboration among stakeholders, ultimately advancing the nation’s energy self-sufficiency goals.