Indonesia relies on green energy

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Investor Daily - Indonesia andalkan energi hijau

16 April 2025

By Euis Rita Hartati

Jakarta, ID – Minister of Energy and Mineral Resources, Bahlil Lahadalia, stated that Indonesia has an advantage in green energy, which can be used to penetrate the European market amidst the tariff war between the United States and China.

"Indonesia has a comparative advantage in green energy, allowing us to penetrate markets anywhere, in Europe, America, anywhere," said Bahlil at the opening of the Global Hydrogen Ecosystem Summit and Exhibition 2025 in Jakarta, Tuesday (15/04/2025).

Indonesia, Bahlil continued, has abundant potential for new and renewable energy, including wind, solar and water.

Specifically for hydropower, Bahlil sees the potential for developing hydropower plants (PLTAs) with a capacity of 3,600 gigawatts (GW) or around 3.6 terawatts (TW). If successful, hundreds of thousands of jobs will be created, and Indonesia could earn billions of US dollars in foreign exchange.

"If we can achieve this, it will create approximately 300,000 jobs and generate around USD70 billion in foreign exchange," he said.

This statement was in response to the reciprocal tariffs announced by the United States in early April. According to him, the increase in trade tariffs is common in the business world.

Therefore, Bahlil continued, people should not feel as if the world is ending.

"This is just part of trade strategy," he said.

Bahlil conveyed that the ongoing tariff war shows that all countries are busy thinking about their sovereignty. Regional blocs, he continued, are no longer trusted.

The Minister of Energy and Mineral Resources believes that the focus should be on building political and economic communication that benefits each country without intervening in each other's affairs.

"This is the essence of a country's existence, to respect each other," said Bahlil.

On 2 April 2025, US President Donald Trump announced reciprocal tariffs on several countries, including Indonesia.

Indonesia was hit with a 32% reciprocal tariff, while other ASEAN countries faced different rates: the Philippines 17%, Singapore 10%, Malaysia 24%, Cambodia 49%, Thailand 36% and Vietnam 46%.

However, on Wednesday (9/4/2025) afternoon US time, Trump announced a 90-day delay on reciprocal tariffs for various trading partner countries but still increased import duties on China.

Countries initially planned to face higher reciprocal tariffs will only be subject to a basic tariff of 10%, which will be the same for steel, aluminium and cars.

Critical minerals

Minister of Energy and Mineral Resources Bahlil Lahadalia will meet with Saudi Arabia's Minister of Industry and Mineral Resources, Bandar Al-Khorayef, this week to discuss cooperation on critical minerals.

"Just a hint, one of the discussions will be about critical minerals," said Bahlil.

Not limited to critical minerals, Bahlil also mentioned that the inter-ministerial meeting will discuss the relationship between the two countries, including what Saudi Arabia needs from Indonesia and vice versa.

Bahlil said the meeting with Saudi Arabia's Minister of Industry and Mineral Resources will take place this week. "Indeed, there is an agenda this week," he said.

According to previous reports, Saudi Arabia's Minister of Industry and Mineral Resources, Bandar Al-Khorayef, will make an official visit to Indonesia to explore strengthening cooperation between the two countries in the industrial and mining sectors.

His ministry stated that Al-Khorayef will meet several high-ranking Indonesian officials and private sector representatives in the mining sector.

"During his visit, His Excellency will meet with several key public sector officials, including Indonesia's Minister of Energy and Mineral Resources and Minister of Industry," according to the ministry's statement received on Sunday (13/4).

The visit aims to strengthen bilateral cooperation in the mining sector, offering significant long-term growth opportunities for both countries.

In the last fiscal year, Indonesia's mineral fuel exports exceeded USD67 billion (around Rp1,124 trillion), while imports reached USD38 billion.

One of the mining sector representatives Al-Khorayef will meet is Febriany Eddy, President Director and CEO of Vale Indonesia, whose shares are partly owned by Saudi Arabia.

Saudi Arabia views its investment in the company as an opportunity for exploration and infrastructure development in Indonesia's mining sector, ensuring the country's clean energy needs are met amidst the renewable energy transition.

Next article: New energy: Indonesia ready to welcome hydrogen

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