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Geothermal Energy in Indonesia: It's Heating Up

Geothermal Energy in Indonesia: It's Heating Up

During the last decade, Indonesia's government has tried to mitigate its' issues with deforestation, pollution and waste management reform as global pressure from environmental agencies continue to fume policy steam. An outsider may perceive Indonesia's effort to promote ethical and ecological legislation as reluctant; however, we must remember that Indonesia, the fourth most populous nation, still ranks high ( 100th out of 182 nations ) on the Corruption Perception Index. In order for Indonesia to be accredited as a legitimate democracy, political reform must occur. Considering its' scale in infrastructure development and the tumultuous inefficiencies adjoined to this sector, Indonesia's interest could likely preside in experienced foreign investors and private energy companies. 

Indonesia is not often in our media stream. If so, it is usually bummer news of either another destructive earthquake, cyclone flooding, or even a chain smoking child. One particular news topic surfacing in Indo has been putting many, including myself, in an imaginative yet hopeful state. As mentioned, Indonesia is prominently known for its natural energy surges correlating to the underlying volcanic geology. Geothermal energy utilization has been on the scene throughout Indonesia since the Dutch colonial regime. Although that was 60 or so years ago, little progress in the renewable energy industry can be acclaimed for the elapsed time. Coal and oil have been the driving energy forces into the 21st century for Indonesia, but this may all change within the next decade. The government has willingly opened up to international energy companies for geothermal infrastructure expansion.

Indonesia has been reported to having the world's largest geothermal power potential with 28 gigawatts or 40% of currently known global geothermal sources (underground natural heat). The existing geothermal plants only supply 4% of the total potential. The financial investment cost to begin construction around a geothermal hot bed is not cheap thus the extremely high initial costs have been the deterrents for most international investors in the past. I would also include the dysfunctional Indonesian bureaucracy to also be a factor. One critical point to mention is that the government is beginning to realize the fragility that their nation is experiencing with further development. The government sees the necessity to diversify their energy sources and has just announced that it plans to spend 367 million US dollars (converted from rupiahs) to finance the construction of more renewable energy production facilities. 2/3 of this amount will be allocated for geothermal energy under a loan structure while the other 1/3 will be for micro-hydropower plants also under a loan structure. What is IMPORTANT to remember is that this money is not subjected exclusively to national companies which has been the Indonesian downfall in the past. Look for private, foreign companies to play a serious role. If this topic has sparked personal interest, please read two of the articles that I have linked below. There are many articles on this topic surfing the web right now, but these two provide an essential foundation. 

For Future Energy, Volcanic Indonesia Bets on Heat : NPR

Geothermal Energy in Indonesia Heating Up : Global Intelligence Alliance

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