Green Energy Investment Trends in Indonesia
- 4 days ago
- 5 min read
You care about the green energy movement, but you’re not sure where to start showing your support? Or maybe you have been hearing a lot about Indonesia’s energy transition and still feel lost on what to do as an investor?
Before jumping straight to, “Which stock should I buy?” There is something far more important to understand first, “How green energy is actually developing in Indonesia?”
Green energy is no longer just an environmental movement. The issue has made its way into national energy policy, electricity planning, corporate strategy, and financial instruments. In other words, clean energy has moved from a campaign to a real part of Indonesia’s development direction.
The Share of Renewables Is Still Small, but the Room to Grow Is Huge
Based on primary energy consumption data, Indonesia’s share of renewable energy was around 11% in 2024. [1][2]
That number is very important. On the one hand, there is still a massive growth window for green energy. On the other hand, Indonesia’s energy transition will not happen overnight.
The national energy system still relies heavily on coal for electricity generation. Shifting to clean energy requires new power plants, transmission networks, large-scale financing, consistent policy, and companies that can actually execute projects on the ground.
The Renewable Energy Mix Target Is Getting Clearer
Based on Indonesia’s State Electricity Company (PLN)’s presentation during the dissemination of the 2025–2034 Electricity Supply Business Plan (RUPTL), the share of renewable energy in power generation is targeted to increase from 15.9% in 2025 to 21.0% in 2030, and to reach 34.3% by 2034. [3]
Unlike the figure of around 11% in 2024, which reflects the share of renewable energy in primary energy consumption, this target refers more specifically to the electricity sector. In other words, over the next decade, Indonesia is aiming for nearly one-third of its national electricity to come from clean energy sources.
This target should still be viewed as a direction, not an automatic guarantee. To achieve it, Indonesia will need new power generation capacity, a stronger electricity grid, energy storage systems, and renewable energy projects that are properly integrated into PLN’s power system. Nevertheless, this direction shows that the electricity sector will serve as one of the main entry points for driving the growth of green energy in Indonesia.
Compared to neighboring countries, Indonesia’s direction is actually in line with the energy transition trend across the region. Malaysia, for instance, targets a 31% share of renewables in its national installed capacity mix by 2025 and 40% by 2035 under the Malaysia Renewable Energy Roadmap. Under the National Energy Transition Roadmap, the target is extended further to 70% by 2050. [4][5]
However, Malaysia’s figures should be read carefully, as they are based on installed capacity rather than the actual share of electricity generated.
The Philippines, meanwhile, uses a measure closer to Indonesia’s own metric: the share of renewables in the power generation mix. Through the National Renewable Energy Program 2020–2040, the Philippines targets renewable energy to reach 35% of the power generation mix by 2030 and 50% by 2040. [6]
Against that backdrop, Indonesia’s target of 34.3% by 2034 shows that Indonesia is moving in the same direction, albeit with a different timeline and starting point. This comparison illustrates that the push toward clean energy is not unique to Indonesia; it is part of a broader energy policy shift across ASEAN.
The RUPTL: Indonesia’s Green Energy Roadmap
The 2025-2034 RUPTL targets an additional 69.5 gigawatt (GW) of power generation capacity by 2034, with approximately 76% coming from renewables and energy storage systems such as batteries and pumped storage. [7]
Solar power takes the largest share with a planned addition of 17.1 GW, followed by hydropower at 11.7 GW, wind at 7.2 GW, geothermal at 5.2 GW, and bioenergy at 0.9 GW. [8]
This is happening alongside steadily rising electricity demand. Power sales are projected to grow from 306 terawatt-hours (TWh) in 2024 to 511 TWh in 2034. [9]
Indonesia does not just need to add clean energy. It also needs to meet surging demand from households, industries, electric vehicles, data centers, and new economic zones.
What Are Our Options for Supporting Green Energy?
The first option is stocks of companies with exposure to green energy. Several issuers on the Indonesia Stock Exchange have assets or businesses in geothermal, hydropower, wind, or biomass. But a “green” label alone is not enough. Stocks still need to be analyzed from a fundamentals perspective, including valuation, cash flow, debt structure, and business risks.
The second option is sustainability-based instruments like Green Sukuk (Sharia Bonds). The Indonesian government uses Green Sukuk as a financing instrument specifically for green and sustainable projects. [9]
For more conservative investors, this can be a way to participate in green financing through the capital markets.
The third option is ESG-themed mutual funds or investment products managed by professional investment managers. These tend to be more diversified, though you still need to read through the portfolio, investment policy, fees, and risks before committing.
And finally, supporting green energy does not always have to take the form of financial investment. Energy efficiency, choosing products that support clean energy, or simply staying informed on EBT policy developments are all real, meaningful forms of support.
Where Should We Start?
The first step is building your understanding. Follow updates on the renewable energy mix, read the RUPTL, understand the characteristics of each generation technology, and get to know companies that genuinely hold clean energy assets. OJK has also published the Indonesia Sustainable Finance Taxonomy (TKBI) as a guide for classifying economic activities that support sustainability. [10]
That helps distinguish which “green” claims are substantive and which are just labels.
From there, decide on the form of support that fits your goals and risk profile. If you are here to learn, start with data and industry understanding. If you are here to invest, start with instruments you actually understand. Indonesia’s green energy journey is underway, but the road ahead is long. Anyone who wants to be part of it needs to see clean energy not as a passing trend, but as an ongoing transformation of how this country powers itself.
Reference:
[1] Our World in Data — Indonesia Energy Country Profile, https://ourworldindata.org/profile/energy/indonesia
[2] Our World in Data — Share of primary energy consumption from renewables
[3] ANTARA News — PLN: Implementasi RUPTL dongkrak bauran EBT jadi 34,3 persen pada 2034, https://www.antaranews.com/berita/4872229/pln-implementasi-ruptl-dongkrak-bauran-ebt-jadi-343-persen-pada-2034
[4] Malaysia Renewable Energy Roadmap — SEDA Malaysia, https://www.seda.gov.my/reportal/myrer/
[5] Malaysia National Energy Transition Roadmap summary — MIDA, https://www.mida.gov.my/national-energy-transition-roadmap-netr-charting-a-path-to-a-sustainable-energy-landscape/
[6] Philippine News Agency — New RE plan targets 35% share of power generation by 2030, https://www.pna.gov.ph/articles/1159659
[7] Ministry of Energy and Mineral Resources — Minister Announces RUPTL PLN 2025-2034, https://www.esdm.go.id/id/media-center/arsip-berita/menteri-esdm-umumkan-ruptl-pln-2025-2034-serap-lebih-dari-17-juta-tenaga-kerja-baru
[8] Ministry of Energy and Mineral Resources / Ditjen Gatrik — RUPTL PLN 2025-2034, https://gatrik.esdm.go.id/assets/uploads/download_index/files/b967d-ruptl-pln-2025-2034-pub-.pdf
[9] Ministry of Finance DJPPR — Green Sukuk as Indonesia's Commitment to Climate Change, https://djppr.kemenkeu.go.id/greensukuksebagaibentukkomitmenindonesiauntukperubahaniklim
[10] OJK — Indonesia Sustainable Finance Taxonomy (TKBI) Version 3, 2026, https://ojk.go.id/id/Publikasi/Roadmap-dan-Pedoman/Sektor-Jasa-Keuangan/Keuangan-Berkelanjutan/Pages/TKBI-Versi-3-2026.aspx
Disclaimer: This content is created for educational purposes or service promotion, and does not constitute a recommendation to buy or sell any specific Securities. Any risks arising from investment decisions made based on the information in this publication are the sole responsibility of the respective audience. PT KAF Sekuritas Indonesia is licensed and supervised by the Financial Services Authority (Otoritas Jasa Keuangan / OJK).
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