The Coordinating Ministry of Economic Affairs, in collaboration with the Southeast Asian Energy Transition Partnership, convened a Focus Group Discussion (FGD) on 15 September 2025, in Jakarta. The session aimed to update relevant stakeholders on the project’s progress and gather feedback on a proposed suite of policy measures designed to accelerate renewable energy development, as well as on the impact analyses conducted on these measures.
This FGD convened Indonesian policymakers, industry leaders, and financial institutions to refine strategies for accelerating the nation’s energy transition. Key discussions involved refining the regulatory landscape to develop a cohesive policy framework to support Indonesia’s energy transition goals. Proposed policy options included adjusting ceiling tariffs to better reflect renewable energy costs, standardising tender processes, and clarifying the status of National Strategic Projects (PSN) to streamline procurement and reduce delays. Participants provided suggestions to incorporate battery energy storage system (BESS) costs in the ceiling prices, ensure alignment with PSN project naming in accordance with the RUPTL, and examined the practicality of proposed measures in improving investor confidence.
Additionally, flexibility in biomass pricing and feedstock quality were considered vital for supporting biomass co-firing initiatives. Stakeholders further provided valuable insights on the economic implications of adjusting the Coal Domestic Price Obligation (DPO) to market rates to enhance RE competitiveness and integration. Developing transmission lines near designated RE clusters and the rights for CFPPs to match offers for RE projects were discussed as policy options to encourage early CFPP retirement while maintaining grid stability.
About the project
The ‘Innovation New Incentives Mechanism for Energy Transition Projects’ Project aims specifically to drive investments in renewable energy and expedite early retirement of coal-fired power plants in Indonesia by identifying effective incentive mechanisms and removal of disincentives to support energy transition projects across three focus areas, namely (i) renewable energy development, (ii) coal-fired power plant early retirement, and (iii) coal phase-down projects (i.e., the capacity factor (CF) reduction and the adoption of co-firing).
The results of this FGD are expected to feed into the Project’s analysis of the potential policy options proposed, particularly stakeholder perceptions, as well as the qualitative and quantitative impacts analysed across the identified focus areas.
