Indonesia Pursues Nuclear Power and Renewables to Shift Away from Fossil Fuels

Indonesia moves towards nuclear power and renewable energy to reduce reliance on coal and fossil fuels. Image Credit : REUTER

Indonesia is in discussions with the United States and Russia to acquire nuclear power technology, with plans to develop nuclear plants by 2036, as per Reuters. This move is part of the country's broader strategy to reduce dependence on fossil fuels, said Deputy Minister Vivi Yulaswati from the Ministry of National Development Planning.

Exploring Nuclear Power Options

The government is considering both small modular reactors (SMRs) and conventional nuclear technologies. However, nuclear power remains controversial in Indonesia due to the country's earthquake-prone nature.

Yulaswati emphasized that nuclear power is still in the early stages of planning. Essential steps like approval from the president and collaboration with international partners are still pending.

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Current Energy Mix and Future Goals

Indonesia, with over 275 million people, faces significant challenges in its energy sector. The country’s power generation is largely dependent on coal, which accounts for more than half of its energy capacity. Clean energy sources like hydropower make up less than 15% of the total capacity.

To address this, Indonesia plans to offer international investors opportunities to develop 75 gigawatts (GW) of renewable energy over the next 15 years.

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Challenges with Funding and Global Partnerships

While Indonesia aims to transition to renewable energy, securing sufficient funding remains a major hurdle. The country was promised $20 billion as part of the G7's Just Energy Transition Partnership (JETP) in 2022. However, the disbursement of funds has been slow.

So far, only $217.8 million in grants have been approved for 33 decarbonization projects in Indonesia. This includes projects to increase electric vehicles in Bali.

In addition, loans totaling up to $6.1 billion have been approved, mainly for national grid upgrades and renewable energy development. However, the interest rates for these loans are still being finalized. Indonesian officials are expressing concerns about the lack of concessional funding under JETP.

Looking Ahead

Yulaswati confirmed that JETP funding will begin next year, coinciding with Indonesia’s new five-year economic planning cycle. While challenges remain, the country is making steady progress toward its energy transition goals.