Working Paper: Corporate green power procurement options in Indonesia: Taking stock of demand and charting the path forward

The Asia Clean Energy Coalition (ACEC), in collaboration with WRI Indonesia, has published a working paper titled "Corporate green power procurement options in Indonesia: Taking stock of demand and charting the path forward." 

More than 11,000 companies globally have established science-based carbon reduction targets, driving clean energy demand across international supply chains. In response to these market expectations, Indonesia currently offers four main green power procurement options: on-site generation, unbundled renewable energy certificates (RECs), utility contracts (GEAS DS), and direct off-site contracts. While these options mark significant progress, corporate buyers continue to experience varying levels of availability and implementation complexity across each mechanism.   

Understanding these buyer experiences and drawing from regional precedents, this study evaluates corporate preferences through a survey of 56 energy buyers alongside comparative insights from peer markets across Asia and South America. The resulting recommendations highlight practical focus areas for market development, including adjusting rooftop solar capacity frameworks, expanding transparency around utility supply pipelines, strengthening REC traceability, and refining regulatory parameters for off-site contracts. 

Key Findings

• Unbundled EACs (RECs): These currently represent the most widely utilized and accessible option in Indonesia. Updating grid emission factors and strengthening tracking systems can further support corporate emissions reporting.
• On-site Generation: This serves as the second most preferred mechanism, with industry participants sharing diverse perspectives regarding deployment opportunities and operational considerations.
• Contracts with Electric Utilities: Following PLN's introduction of Green Energy as a Service (GEAS DS), contracts with utilities reflect growing market interest and offer a promising foundation for expanded buyer awareness and engagement.
• Contracts with Off-site Generators: This has been highlighted as an attractive long-term option, with regional experiences suggesting that such mechanisms mature effectively through phased implementation, close buyer-utility collaboration, and alignment with national energy priorities.

Avenues of Strategic Opportunities for Indonesian Stakeholders

Key government partners can consider several collaborative avenues to facilitate clean energy investment and further enhance market access:

• On-site Solar Frameworks: Continued collaboration can help align subnational rooftop PV capacity quotas with demand in industrial hubs, while integrating energy storage and grid-cost sharing mechanisms to maintain system reliability.
• REC Market Alignment: Joint efforts to refine policy guidelines for RECs can further enhance tracking integrity, data transparency, and voluntary market participation.
• Utility Green Products: Expanded communication around the GEAS DS program, including dedicated power plant pipelines and cost structures, can build buyer confidence and support broader adoption.
• Joint Utilization Frameworks: Collaborative pilot initiatives under ministry leadership can provide procedural clarity for grid sharing while establishing balanced grid rental fees that cover network operating costs.