IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i5p2216-d1604868.html
   My bibliography  Save this article

Advancing Renewable Energy in Indonesia: A Comprehensive Analysis of Challenges, Opportunities, and Strategic Solutions

Author

Listed:
  • Indra A. Aditya

    (Perusahaan Listrik Negara, Jakarta 12160, Indonesia)

  • Tito Wijayanto

    (School of Business and Management, Institut Teknologi Bandung, Bandung 40132, Indonesia)

  • Dzikri F. Hakam

    (School of Business and Management, Institut Teknologi Bandung, Bandung 40132, Indonesia)

Abstract

Indonesia’s commitment to the early retirement of coal-fired power plants (CFPPs) underscores the urgent need to transition to renewable energy due to coal’s significant contribution to environmental degradation and rising CO 2 emissions. Despite this urgency, several challenges impede the widespread adoption of renewable energy, including disparities in energy access, inadequate policy implementation, unreliable government financing mechanisms, and lack of education and awareness, especially due to the current incorporation of hydrogen and nuclear energy. To overcome these barriers, a robust policy framework is essential, complemented by progressive policy enactment. This study examines Indonesia’s evolving energy landscape, highlighting key challenges and opportunities for the implementation of renewable energy. The findings emphasize that a comprehensive and integrated roadmap is critical to unlocking Indonesia’s renewable energy potential. The roadmap includes strengthening governance, fostering public–private collaborations, and securing diverse financing channels, while offering targeted incentives, such as tax breaks and financial benefits. Furthermore, conducting pre-feasibility studies and regional assessments for emerging energy sources, like hydrogen and nuclear power, is crucial to accurately evaluate potential risks and opportunities. By addressing gaps in regulatory framework and enforcing effective policy measures, Indonesia can facilitate public–private partnerships, promote technology transfer, and develop skilled workforce as an effort to transition into a sustainable and diversified energy future.

Suggested Citation

  • Indra A. Aditya & Tito Wijayanto & Dzikri F. Hakam, 2025. "Advancing Renewable Energy in Indonesia: A Comprehensive Analysis of Challenges, Opportunities, and Strategic Solutions," Sustainability, MDPI, vol. 17(5), pages 1-20, March.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:5:p:2216-:d:1604868
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/5/2216/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/5/2216/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hakam, Dzikri Firmansyah, 2019. "Mitigating the risk of market power abuse in electricity sector restructuring: Evidence from Indonesia," Utilities Policy, Elsevier, vol. 56(C), pages 181-191.
    2. Putu Agus Aditya Pramana & Dzikri Firmansyah Hakam & Handrea Bernando Tambunan & Kemas Muhammad Tofani & Kevin Gausultan Hadith Mangunkusumo, 2024. "How Are Consumer Perspectives of PV Rooftops and New Business Initiatives in Indonesia’s Energy Transition?," Sustainability, MDPI, vol. 16(4), pages 1-17, February.
    3. Hasan, M.H. & Mahlia, T.M.I. & Nur, Hadi, 2012. "A review on energy scenario and sustainable energy in Indonesia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(4), pages 2316-2328.
    4. Heffron, Raphael J. & Körner, Marc-Fabian & Sumarno, Theresia & Wagner, Jonathan & Weibelzahl, Martin & Fridgen, Gilbert, 2022. "How different electricity pricing systems affect the energy trilemma: Assessing Indonesia's electricity market transition," Energy Economics, Elsevier, vol. 107(C).
    5. Satria Putra Kanugrahan & Dzikri Firmansyah Hakam & Herry Nugraha, 2022. "Techno-Economic Analysis of Indonesia Power Generation Expansion to Achieve Economic Sustainability and Net Zero Carbon 2050," Sustainability, MDPI, vol. 14(15), pages 1-25, July.
    6. Handrea Bernando Tambunan & Dzikri Firmansyah Hakam & Iswan Prahastono & Anita Pharmatrisanti & Andreas Putro Purnomoadi & Siti Aisyah & Yonny Wicaksono & I Gede Ryan Sandy, 2020. "The Challenges and Opportunities of Renewable Energy Source (RES) Penetration in Indonesia: Case Study of Java-Bali Power System," Energies, MDPI, vol. 13(22), pages 1-22, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Natalina Damanik & Risa Saraswani & Dzikri Firmansyah Hakam & Dea Mardha Mentari, 2025. "A Comprehensive Analysis of the Economic Implications, Challenges, and Opportunities of Electric Vehicle Adoption in Indonesia," Energies, MDPI, vol. 18(6), pages 1-21, March.
    2. Satria Putra Kanugrahan & Dzikri Firmansyah Hakam & Herry Nugraha, 2022. "Techno-Economic Analysis of Indonesia Power Generation Expansion to Achieve Economic Sustainability and Net Zero Carbon 2050," Sustainability, MDPI, vol. 14(15), pages 1-25, July.
    3. Dzikri Firmansyah Hakam & Sudarso Kaderi Wiyono & Nanang Hariyanto, 2020. "Competition in Power Generation: Ex-ante Analysis of Indonesia’s Electricity Market," Energies, MDPI, vol. 13(24), pages 1-20, December.
    4. Tang, Shengwen & Chen, Jingtao & Sun, Peigui & Li, Yang & Yu, Peng & Chen, E., 2019. "Current and future hydropower development in Southeast Asia countries (Malaysia, Indonesia, Thailand and Myanmar)," Energy Policy, Elsevier, vol. 129(C), pages 239-249.
    5. Daniela Pereira Macedo & António Cardoso Marques & Olivier Damette, 2023. "Challenges in Assessing the Behaviour of Nodal Electricity Prices in Insular Electricity Markets: The Case of New Zealand," Economies, MDPI, vol. 11(6), pages 1-19, June.
    6. Trutnevyte, Evelina & McDowall, Will & Tomei, Julia & Keppo, Ilkka, 2016. "Energy scenario choices: Insights from a retrospective review of UK energy futures," Renewable and Sustainable Energy Reviews, Elsevier, vol. 55(C), pages 326-337.
    7. Qiaochu Li & Peng Zhang, 2025. "Study of the Safety–Economy–Environmental Protection Coordination of Beijing’s Natural Gas Industry Based on a Coupling Coordination Degree Model," Sustainability, MDPI, vol. 17(6), pages 1-25, March.
    8. Veldhuis, A.J. & Reinders, A.H.M.E., 2013. "Reviewing the potential and cost-effectiveness of grid-connected solar PV in Indonesia on a provincial level," Renewable and Sustainable Energy Reviews, Elsevier, vol. 27(C), pages 315-324.
    9. Satya Widya Yudha & Benny Tjahjono & Philip Longhurst, 2021. "Stakeholders’ Recount on the Dynamics of Indonesia’s Renewable Energy Sector," Energies, MDPI, vol. 14(10), pages 1-19, May.
    10. Ninoslav Holjevac & Tomislav Baškarad & Josip Đaković & Matej Krpan & Matija Zidar & Igor Kuzle, 2021. "Challenges of High Renewable Energy Sources Integration in Power Systems—The Case of Croatia," Energies, MDPI, vol. 14(4), pages 1-20, February.
    11. Meisheng He & Habib Forootan Fard & Khalid Yahya & Mahmoud Mohamed & Ibrahim Alhamrouni & Lilik Jamilatul Awalin, 2023. "Optimal Design of Hybrid Renewable Systems, Including Grid, PV, Bio Generator, Diesel Generator, and Battery," Sustainability, MDPI, vol. 15(4), pages 1-16, February.
    12. Motasemi, F. & Afzal, Muhammad T., 2013. "A review on the microwave-assisted pyrolysis technique," Renewable and Sustainable Energy Reviews, Elsevier, vol. 28(C), pages 317-330.
    13. Deendarlianto, & Widyaparaga, Adhika & Sopha, Bertha Maya & Budiman, Arief & Muthohar, Imam & Setiawan, Indra Chandra & Lindasista, Alia & Soemardjito, Joewono & Oka, Kazutaka, 2017. "Scenarios analysis of energy mix for road transportation sector in Indonesia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 13-23.
    14. Islam, Md Tasbirul & Huda, Nazmul & Abdullah, A.B. & Saidur, R., 2018. "A comprehensive review of state-of-the-art concentrating solar power (CSP) technologies: Current status and research trends," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 987-1018.
    15. Sugiawan, Yogi & Managi, Shunsuke, 2016. "The environmental Kuznets curve in Indonesia: Exploring the potential of renewable energy," Energy Policy, Elsevier, vol. 98(C), pages 187-198.
    16. Sajjad, H. & Masjuki, H.H. & Varman, M. & Kalam, M.A. & Arbab, M.I. & Imtenan, S. & Rahman, S.M. Ashrafur, 2014. "Engine combustion, performance and emission characteristics of gas to liquid (GTL) fuels and its blends with diesel and bio-diesel," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 961-986.
    17. Hilda Hilmiyati-Mas’adah & Achmad Sudiro & Fatchur Rohman & Agung Yuniarinto & Dzikri Firmansyah Hakam & Herry Nugraha, 2023. "Assessing the Impact of Urban Lifestyle and Consumption Values on Conversion Intention: A Study towards Energy Sustainability," Sustainability, MDPI, vol. 15(8), pages 1-18, April.
    18. Durmaz, Tunç & Acar, Sevil & Kızılkaya, Simay, 2024. "Generation failures, strategic withholding, and capacity payments in the Turkish electricity market," Energy Policy, Elsevier, vol. 184(C).
    19. Kunaifi & Angèle Reinders, 2018. "Perceived and Reported Reliability of the Electricity Supply at Three Urban Locations in Indonesia," Energies, MDPI, vol. 11(1), pages 1-27, January.
    20. Zhao, Congyu & Dong, Kangyin & Lee, Chien-Chiang, 2024. "Carbon lock-in endgame: Can energy trilemma eradication contribute to decarbonization?," Energy, Elsevier, vol. 293(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:5:p:2216-:d:1604868. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.