The report titled “Indonesia Power Market Outlook to 2030, Update 2017-Market Trends, Regulations, and Competitive Landscape”, provides a comprehensive analysis of power market in Indonesia, demography of Indonesia economy and natural resources, power generation in country, leading players, share of various power generations, and future of power market in Indonesia.
Power Market Overview: Indonesia has the largest economy in Southeast Asia, ranks fourth in population and is the seventeenth largest economy in the world. The country witnessed a tremendous economic development due to the government changes to its regulatory framework that has encouraged the economic growth. This economic growth has resulted in increased investment from the private sector from both foreign and domestic players. However, Indonesia struggles with poverty, unemployment, corruption, poor infrastructure, complex regulatory environment and unequal resource distribution among its various regions. Indonesia has substantial natural resources such as crude oil, natural gas, tin, copper and gold. It is also a major importer of chemicals, fuels, food stuffs, and machinery and equipment, and net importer of crude oil. It exports gas, coal, electrical appliances, rubber, textiles and plywood. The major trading partners are China, Japan, Singapore and the US. The country’s oil production has declined due to its largest oil fields that have reached their brink and the country is unable to develop new comparable resources. Despite being a net importer of crude oil, it is also a net exporter of natural gas and coal.
The power market in Indonesia refers to the electricity generation for industrial and domestic use. Electricity generation refers to the production of electric energy by transforming other forms of energy. The various form of generation of electricity are from renewable energy resources, nuclear fuel, water, and by burning fossil fuels. Renewable energy resources are naturally replenishing energy resources that are limited in the amount of energy that is available per unit of time, such as biomass, geothermal, solar and wind. Nuclear power refers to the electricity generated by the use of the thermal energy released from the fission of nuclear fuel in a reactor. A hydropower plant is one in which turbine generators are driven by falling water. A thermal power plant is one in which turbine generators are driven by burning fossil fuels.
Leading Players in Power Market in Indonesia: The Ministry of Energy and Mineral Resources (MEMR) in Indonesia is the chief regulator of the power sector, that is responsible for the legislation, implementation, co -ordination, enforcement and compliance of the electricity sector or power sector. PT PLN (Persero) and PT Adaro Energy Tbk are the leading players in the Indonesia’s power market. Perusahaan Perseroan PT Perusahaan Listrik Negara (PLN) is a state -owned power utility and is the dominant player in the power sector. It owns almost the maximum country’s power-generating capacity through its subsidiaries and controls the Transmission and Distribution (T&D) activities. The rest of the capacity is owned by the private sector through Independent Power Producers (IPPs). With the increase in private power projects that are expected to schedule in the next few years, the electrification ratio in the country is expected to increase with the increasing private investments in the Indonesia’s electricity infrastructure. The power market in Indonesia covers market segments related to installed electricity capacity, generation, consumption, power infrastructure and regulations.
Way Forward in Indonesia’s Power Market: Initially, the power capacity installed in Indonesia was dominated by coal-fired power plants, which accounted for a majority share. Gas-fired plants made the next highest contribution, followed by hydroelectric power and oil-fired plants. Renewable sources also accounted for a minimum share of the power capacity in the country. The growth in the thermal, hydro and renewable power with thermal fuel sources such as coal, oil and gas contributed a combined share of the total installed power capacity in Indonesia. Thermal fuel sources will remain the highest contributors during the next few years and there would be higher contributions from renewable and hydro power plants by the year 2030.
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Ankur Gupta, Head Marketing & Communications
ankur [@] kenresearch.com