Indonesia's Electricity Supply Surplus: A Projection of Indonesia's Electricity Needs

PT Perusahaan Listrik Negara (PLN), Indonesia's state-owned electricity company, is experiencing an electricity oversupply. The Secretary General of the Ministry of Energy and Mineral Resources stated that by the end of this year, PLN's surplus electricity will reach 6 Gigawatts (GW).

As is known, PT PLN (Persero) is bound by Power Purchase Agreements (PPAs) with Independent Power Producers (IPPs), particularly those developing coal-fired power plants (PLTU).

These sales contracts stipulate penalties. PLN is obligated to take all contracted electricity or pay penalties if it fails to take the contracted volume, a scheme commonly known as "Take or Pay" (TOP).

However, electricity demand remains sluggish and below initial targets due to the COVID-19 pandemic since 2020 and the addition of several new power plants. This has resulted in a surplus of electricity.

Meanwhile, in its Electricity Supply Business Plan (RUPTL) 2021-2030, PLN projects domestic electricity production in 2022 to reach 6,448 Gigawatt Hours (GWh) and electricity sales of 6,318 Gigawatt Hours (GWh). With a projected economic growth of 4.32%, PLN projects a peak electricity load of 925 megawatts (MW) with 2,246,076 customers.

Projected electricity consumption is expected to increase over the next decade, as shown in the graph. By 2030, PLN estimates that with 3.31% economic growth, electricity sales will reach 10,617 GWh and production will reach 11,480 GWh.

The number of customers is projected to reach 2,471,779 by 2030, and the peak electricity load is expected to reach 1,495 MW.