What is the Geothermal Energy Potential in Indonesia?

The development of geothermal energy, a type of renewable energy, has not been optimally utilized in Indonesia. Only 1,438.5 MW of electricity is currently generated from this source, while the potential is estimated at around 29,000 MW. Compared to global geothermal electricity generation, Indonesia only contributes 12.59%.

Furthermore, the development of this renewable energy is still concentrated in Java. While the greatest potential lies in Sumatra, installed capacity remains minimal. The regions of Kalimantan, Maluku, and Papua remain completely untapped. Year after year, geothermal energy development in Indonesia faces the same challenges: difficulty in reaching agreements on the selling price of geothermal steam and electricity. Land acquisition and licensing also pose significant problems, as geothermal resources are generally located in forested areas.

The suboptimal development of geothermal energy in Indonesia has prompted the World Bank to allocate US$55.25 million for the development of geothermal power plants in the country. This funding will be channeled through the Clean Technology Fund (US$49 million) and the Global Environment Facility (US$6.25 million).