Renewable energy uptake has yet to gather momentum across Indonesia’s more than 84,000 villages, a new report concludes, as the government of the world’s fourth-largest country pledges to achieve a radical energy transformation over the next decade.
“Village street lighting has increased, while household use has declined due to high initial costs, minimal incentives, and the dominance of fossil fuel subsidies,” according to the Village Energy Transition Readiness Index, a report published by Jakarta-based think tank the Center of Economic and Law Studies (Celios) and Greenpeace.
Indonesia’s statistics agency counted 84,291 villages across the world’s largest archipelagic nation as of 2025. Around 1.4 million people among Indonesia’s population of 270 million still lack all access to electricity, according to Eniya Listiani Dewi, the renewable energy lead at Indonesia’s mining and energy ministry.
“Previously, many villages had clean energy initiatives, including solar power plants, micro-hydropower plants, and others, but the number of such initiatives has actually gone down,” said Wahyudi Askar at Celios.
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When global oil prices are today rising and the energy transition in Indonesia is simultaneously moving slowly, we will experience serious consequences. This study is a reflection of the slow energy transition in Indonesia.
Wahyudi Askar, analyst, Celios
Despite technological progress and the availability of cheaper solar hardware, the total number of villages and subdistricts reporting solar power use among households declined from 4,176 in 2021 to 3,076 in 2024, a reduction of 26.4 per cent.
However, the number of villages using street lighting powered by photovoltaics increased over the same period.
Some 24,766 villages or neighbourhood areas used solar to power streetlights in 2021, and this increased by 20.1 per cent over the three-year period to 30,476 in total.
For more than a decade, local governments and charitable organisations have often used basic solar systems supported by batteries to provide cutoff communities with lighting for the first time. However, in some cases the household or community does not have the capacity to repair a system following component failure.
Regional inequality remains, the report noted, with urbanised and wealthier areas of Java Island and East Kalimantan province, on the island of Borneo, recording progress in renewable energy uptake, while rural and remote areas of eastern Indonesia reported declines.
Despite plentiful sunshine along the equator, Indonesia has lagged behind every other G20 country in adopting solar energy. Less than half a per cent of the national grid operated by state-owned utility PLN is powered by photovoltaics.
A utility-scale solar field opened in 2023 with a 192-megawatt capacity, while limited reforms have enabled easier installation of photovoltaics on homes and public buildings.
However, researchers say Indonesia would need to install 5 gigawatts of new capacity every year in order to meet its long-term goal for 75 gigawatts of renewable energy by 2040.
“That is equivalent to establishing 26 of Indonesia’s largest solar farms, the 192MW Cirata floating solar project, every year for the next 15 years,” wrote Grant Hauber for the Institute for Energy Economics and Financial Analysis (IEEFA), a US-based think tank.
Indonesia’s New Order autocratic government oversaw a highly centralised political system for decades, until student-led protests toppled President Suharto in 1998.
Decentralisation introduced in 2001 devolved significant power and fiscal transfers from the centre to district governments, before a 2014 law then expanded the authority of village heads in overseeing local education, infrastructure, primary health services and sanitation.
Celios and Greenpeace said the government should better align the energy transition with village economic development by redirecting fossil fuel subsidies to renewables, by expanding micro-hydro and solar power, and allowing villages a greater role in shaping policy.
“When global oil prices are rising today, and the energy transition in Indonesia is simultaneously moving slowly, we will experience serious consequences,” said Celios’s Wahyudi. “This study is a reflection of the slow energy transition in Indonesia.”
This story was published with permission from Mongabay.com.
