Indonesia flags fivefold boost to renewables spend in 2016

As Australia prepares to pass its diminished Renewable Energy Target into law, one of its closest regional neighbours, Indonesia, has indicated it will be increasing its budget for renewables development five-fold, to a little over $A1 billion (IDR 11 trillion), in 2016.

Indonesia’s Energy and Mineral Resources Ministry said on Friday that the budget for the directorate general for new renewable energy and energy conservation could rise from IDR2.2 trillion in 2015, to IDR11 trillion next year, according to the Jakarta Post.

“There’s […] an indication that the budget for my division will go up five times next year,” said Maritje Hutapea, the director for energy conservation.

At this stage, the Indonesian government aims to source 23 per cent of its total energy from renewables by 2025. In the 2015 state budget, the government allocated IDR14.9 trillion for the ministry, with only around IDR1.7 trillion going to the renewable and new energy division.

This year, the focus has been on the development of rooftop solar, with PV arrays being planned for government office buildings in urban areas, as well as for a number of airports in the country.

According to local reports, the ministry is set to finish calculating solar feed-in tariffs by the end of July, in an attempt to drive PV investment. It also has plans to launch tenders for rooftop PV systems.

Beyond solar, the ministry is also planning to construct 5.8MW of micro hydropower plants, to be operated by both independent power producers and the government, according to the report. Wind power is also part of the country’s energy program.

Earlier this month, the government also announced plans to launch a pilot marine energy project in 2015.

Ministry spokesman Dadan Kusdiana said that while Indonesia had been unsuccessful in previous attempts to attract private marine energy developers through an open bidding process, a study was now in progress and the ministry was hopeful a pilot project could start this year.

Certain trial projects have already been carried out by the Agency for the Assessment and Application of Technology (BPPT) in Indonesia, mainly involving wave and ocean current generation.

The East Nusa Tenggara has been identified as the province offering the best locations for marine energy arrays. According to ministry estimates, the country’s potential for marine power generation stands at about 60GW.

Meanwhile, Indonesia also appears to be idling its coal output, with reports earlier this month indicating that the world’s largest exporter of the fossil fuel had reduced coal production by 21 percent year-on-year in the first quarter of 2015, to 97 million tonnes.

This put the country on track for 2015 output of about 388 million tonnes, which is near the mid-point of the 350-400 million tonnes forecast by Pandu Sjahrir, the chairman of the Indonesian Coal Mining Association, according to Reuters.

The low end of Sjahrir’s forecast would mean a decline of 24 per cent in coal output in 2015 from 2014, and would also be 75 million tonnes below the 425 million forecast by the government.

In Australia, Department of Industry has forecast that 2014/15 exports will reach 201 million tonnes, up 3.2 per cent from the prior fiscal year.