Indonesia

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GH2 Country Portal – Indonesia

Green hydrogen vision

Indonesia aims to reduce emissions by 29% by 2030 and achieving net-zero emissions by 20601. Indonesia has set forward a vision to utilize green hydrogen, ammonia and carbon capture and storage to reduce its carbon footprint (Hydrogen roadmap in preparation by the Ministry of Energy). It targets using green hydrogen as an alternative energy for the transportation, industrial and household sectors in the future.  

“The Indonesian government is developing green hydrogen as a renewable energy source to achieve its carbon neutrality target by 2060” - Yahya Rachmana Hidaya, Director of Energy, BAPPENAS 

National Strategy

The government is currently preparing a national green hydrogen roadmap to increase capacity and investment.

Capacity and capacity targets

Green hydrogen production targets to be defined in the roadmap.  

“Indonesia's state-owned Pertamina is looking to renewable energy sources such as hydrogen to meet its target of adding 10GW of clean energy power generation capacity by 2026, in line with its green transition plan for 2050” (Argus Media) 

Impact Targets

The Indonesian government has set the following emissions reduction targets through production of green hydrogen: 

  • 2021-2025: 198 million tonnes of CO2 

  • 2026-2030: 314 million tonnes of CO2 

  • 2031-2035: 475 million tonnes of CO2 

  • 2036-2040: 796 million tonnes of CO2 

  • 2041-2050: 956 million tonnes of CO2 

  • 2051-2060: 1,526 million tonnes of CO2

Policy spotlight/ Projects 

  • Public and private sector collaboration. 2 A cooperation agreement between the state-run fertilizer manufacturer PT Pupuk Indonesia, state-owned oil and gas company PT Pertamina, and Mitsubishi has been signed to develop the green hydrogen and green ammonia value chain.  

  • Fortescue Future Industries (FFI) and the North Kalimantan Provincial Government of the Republic of Indonesia have signed a Cooperation Agreement3 to explore green hydrogen projects for domestic and exports usage in Indonesia (July 2021). 

  • Global Green Growth Institute (GGGI) is collaborating with Samsung and Hyundai on a $1.2 billion clean energy project in Indonesia to produce green hydrogen. Samsung is doing the design and the validity study, while Hyundai is responsible for the green ammonia shipping. The Green hydrogen is to be harvested from a geothermal energy source in the Sarulla Block, North Sumatra and will be supplied to the Sei Mangkei Industrial Zone nearby steel and cement making factories. 

Financing

  • The government of Indonesia is expecting to need private sector investments of $25.2 billion to develop green hydrogen from 2031 to 2060. 

  • Pertamina is investing $11 billion for green hydrogen, as part of its green energy target. 

  • The Global Green Growth Institute (GGGI) is collaborating with Samsung and Hyundai on a $1.2 billion clean energy project in Indonesia to produce green hydrogen in the Sarulla Block, North Sumatra. 

Government green hydrogen lead

  • The Ministry of Energy & Mineral Resources 

  • Ministry of National Development Planning [BAPPENAS] 

Comments

The Indonesian government recognises the need to urgently wind down the production and use of coal, oil and gas, while at the same time provide affordable energy for a rapidly growing population and economy. It will be significant challenge for the government to execute progressive policies and enable a swift shift away from fossil fuels to renewables and green hydrogen across the whole nation.