With abundant water resources, the Indonesian government is seeking to attract private investment to expand hydropower development. (Photo: iStock)
Recent severe flooding in Nepal has damaged hydropower facilities, highlighting the importance of assessing safety risks in hydropower development. The risks are equally relevant for Indonesia as it pushes ahead with plans to expand the sector. The country recently unveiled a new strategy aimed at attracting more private capital through bundled procurement as part of its broader energy transition.
However, expanding hydropower will first require state-owned utility PLN to convince private companies that the projects are worth investing in. RECCESSARY spoke with experts from Indonesian and international think tanks to examine the state of the country’s hydropower sector and identify five key issues companies should consider before investing.
Unlock the full article to explore three key takeaways:
- Indonesia’s 2025-2034 Electricity Supply Business Plan (RUPTL 2025-2034) targets 11.7 GW of new hydropower capacity, with more than 260 projects to be developed by private companies.
- PLN’s “GIGA ONE Hydro” procurement program bundles projects totaling 7,046 MW, but the approach could raise barriers to entry for small and mid-sized developers.
- The Chinese-backed Batang Toru hydropower project had its permit revoked over a land dispute, prompting the Indonesian government to seek about USD 270 million in compensation and dealing a blow to investor confidence.
