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Indonesia power and renewable markets long-term outlook 2017

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29 June 2017

Indonesia power and renewable markets long-term outlook 2017

Report summary

The Indonesian government continues to implement several policies to solve the power crisis and improve the performance of the power sector. However, the recent regulations have caused dismay among the industry players. Project terms are generally becoming less attractive, following the recent revisions of the power purchase agreements (PPAs). Meanwhile, the new renewable energy price benchmark will make several projects uneconomic. We have maintained our forecast that coal will continue to dominate the fuel mix, with gas in second place. On a brighter note, the electricity subsidy removal has been quite successful and the measure was extended to a wider consumer group.

Table of contents

  • Executive summary
  • Market background
    • Revised PPA terms
    • Lower renewable energy prices
    • Power demand growth at 5.9% a year
    • Power generation mix outlook
    • Electricity subsidy removal has been successful
    • Regional map
    • Data summary
  • Economic outlook
    • Key players
    • Indonesia power market value chain
      • Generation
      • Transmission
      • Distribution and retail
    • Energy policy
    • Power market regulation
      • Single-buyer model
      • PPA prices
      • Fuel mix
      • Renewables
      • Pricing
      • Land acquisition and licensing
    • Policy
    • Renewables
    • COP21 INDC target
    • Indonesia capacity and reserve margin
      • West Kalimantan
      • East Central South Kalimantan
      • Sulawesi
      • Papua Timor Maluku Nusa Tenggara
      • Appendix
    • Breakeven cost by technology
      • Short run marginal cost analysis
    • Java-Bali power transmission infrastructure
      • Current power infrastructure in Java
      • Future power infrastructure in Java
    • Sumatra power transmission infrastructure
      • Current power infrastructure in Sumatra
      • Future power infrastructure in Sumatra
        • Possible link to Malaysia
      • Losses in Sumatra
    • Indonesia GDP growth and power sales
    • Annual generation forecast
    • Plant utilisation (capacity factor)
    • Transmission utilisation across regions
      • Inter-regional transmission capacity
      • Inter-regional power transfers
    • End-user tariffs
    • Average annual system short-run costs
    • Break-even cost forecast
      • Java-Bali and Sumatra break-even cost for power end-users*
    • GDP sensitivity on gas demand (Java and Sumatra)
    • Coal sensitivity on gas demand
      • Java-Bali
      • Sumatra
      • Impact of RUPTL 2017

Tables and charts

This report includes 65 images and tables including:

  • Executive summary: Image 1
  • GDP forecast - Indonesia
  • Economic indicators
  • Indonesia provincial map
  • Executive summary: Image 2
  • Indonesia power available capacity
  • Indonesia power market balance
  • Indonesia gas demand by sector
  • Key changes to analysis from H2 2016 publication:
  • Indonesia’s energy policy and regulatory structure
  • Policy and regulation: Image 2
  • Major energy legislation
  • Environmental policy and renewables: Image 1
  • Generation mix: renewables vs non-renewables
  • Renewable capacity by fuel
  • Renewable generation by fuel
  • Indonesia INDC target
  • Existing and planned capacity with peak load
  • Indonesia capacity by plant type and reserve margin
  • Java Bali capacity by plant type and reserve margin
  • Sumatra capacity by plant type and reserve margin
  • Rest of Indonesia available capacity
  • Rest of Indonesia reserve margin
  • Break-even cost (LRMC) based on technology (2020 prices)
  • Java Bali - new plant economics by technology (LRMC) for new-build using real levelised prices (2020-2035)
  • Sumatra/rest of Indonesia - new plant economics by technology (LRMC) for new-build using real levelised prices (2020-2035)
  • Power infrastructure – South Sumatra
  • Indonesia GDP growth and power sales growth
  • Indonesia power sales
  • Demand: Table 1
  • Indonesia grid generation by fuel used
  • Java-Bali grid generation by fuel used
  • Sumatra grid generation by fuel used
  • Rest of Indonesia grid generation by fuel used
  • Java-Bali: Capacity factor by plant type (% utilisation)
  • Sumatra: Capacity factor by plant type (% utilisation)
  • PLN’s average electricity prices*
  • PLN’s electricity prices by segments
  • Java-Bali : average annual short-run generation costs
  • Sumatra : average annual short-run generation costs
  • The government subsidy to PLN under the Public Service Obligation
  • Risks and uncertainties: Image 1
  • Power demand sensitivity on gas
  • PPA reference ceiling prices for IPP projects
  • Renewable energy selling prices*
  • Geothermal selling prices (Ministerial Regulation 17/2014)*
  • Renewable energy selling prices based on MEMR Regulation 12/2017
  • Expedited electricity licensing and permitting (Presidential Regulation 4/2016)
  • Java-Bali 2020 merit order
  • Java-Bali 2025 merit order
  • Sumatra 2020 merit order
  • Sumatra 2025 merit order
  • Power infrastructure – West and Central Java
  • Power infrastructure – East Java and Bali
  • Power infrastructure – Central Sumatra
  • Power infrastructure – Aceh and North Sumatra
  • Java-Bali: power transmission capacity across regions
  • Sumatra: power transmission capacity across regions
  • Java Bali: intra-regional power transfers
  • Sumatra: intra-regional power transfers
  • Prices: Image 5
  • Java-Bali coal growth for high and low case
  • Java-Bali coal demand sensitivity on gas in power
  • Sumatra coal growth for high and low case
  • Sumatra coal demand sensitivity on gas in power

What's included

This report contains:

  • Document

    Indonesia Power Data.xls

    XLS 2.18 MB

  • Document

    Indonesia power and renewable markets long-term outlook 2017

    PDF 3.14 MB

  • Document

    Indonesia power and renewable markets long-term outlook 2017

    ZIP 3.57 MB

  • Document

    Executive summary

    PDF 1.11 MB

  • Document

    Economic outlook

    PDF 96.01 KB

  • Document

    Policy and regulation

    PDF 263.78 KB

  • Document

    Environmental policy and renewables

    PDF 102.71 KB

  • Document

    Supply

    PDF 160.13 KB

  • Document

    Costs

    PDF 206.80 KB

  • Document

    Infrastructure

    PDF 1.48 MB

  • Document

    Demand

    PDF 97.70 KB

  • Document

    Supply-demand balances

    PDF 147.25 KB

  • Document

    Prices

    PDF 148.51 KB

  • Document

    Risks and uncertainties

    PDF 104.67 KB

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