Indonesian President Prabowo Subianto has promoted the national sovereign fund’s investment in the waste-to-energy industry after taking office. (Photo: Wikimedia Commons)
Indonesia’s sovereign wealth fund Danantara is fast-tracking its waste-to-energy (WtE) program, with at least eight projects scheduled to break ground by the end of October.
The initiative will gradually expand to 33 cities nationwide, with each plant requiring up to USD 180 million in investment and generating around 15 MW of power. The overall program is expected to cut up to 80% of the country’s greenhouse gas emissions.
Indonesia’s sovereign wealth fund backs WtE plants
Danantara Managing Director Stefanus Ade Hadiwidjaja said the program aims to tackle Indonesia’s mounting waste crisis. The country generates 35 million tons of waste annually, over 60% of which is mismanaged, causing severe environmental pollution.
The sovereign fund will partner with the Ministry of Environment, the Ministry of Energy and Mineral Resources, and local governments, while also inviting private companies and foreign investors to participate.
Each plant will process around 1,000 tons of waste daily, producing about 15 MW of electricity, while reducing landfill use by up to 90%.
Jakarta will host four to five plants in the first phase before the program expands across Java, Bali, and other regions. Construction will require 500–1,000 workers per site over 18 to 24 months, with even greater manpower needed for operations, potentially boosting Indonesia’s economy and employment.
Indonesia faces a severe waste problem, with over 60% left untreated. (Photo: iStock)
WtE tariff set at USD 0.20/kWh as PLN takes charge
Home Affairs Minister Tito Karnavian said that transferring waste management to Danantara will help ease the financial burden on local governments. Local authorities are required to provide land but are no longer obligated to pay “tipping fees” to landfill operators, which has become one of the key reasons why waste-to-energy (WtE) plants are able to expand quickly. However, Tito admitted that it remains unclear how much expenditure local governments will actually save.
Electricity generated by the WtE plants will be purchased centrally by the state utility PLN. PLN President Director Darmawan Prasodjo noted that the success of the program will depend on its technical and commercial feasibility, stressing the need for the projects to secure financing as soon as possible. Danantara CEO Rosan Roeslani added that electricity from the WtE plants will be sold at a standardized tariff of USD 0.20 per kWh.
Source: Antara(1), (2), Jakarta Globe, Reuters, Kompas, Xinhua
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