A vision for energy security and economic growth on the country’s road to net zero emissions by 2060.
At the COP29 United Nations climate conference held in November 2024, more than 65,000 delegates from across the globe convened to deliberate actionable solutions for protecting the planet. Among the key issues discussed at this year’s summit was the importance of securing and mobilizing investments for the clean energy transition of emerging and developing economies.
Amid the backdrop of climate discussions at the annual summit, Indonesia unveiled its plans to offer international investors the opportunity to develop 75 gigawatts of renewable power in the country over the next 15 years. As part of Indonesia’s wider pledge to achieve net zero emissions by 2060, this investment plan would spell a significant leap for climate progress, especially with the Southeast Asian nation being one of the fastest-growing economies in the world.
A path to energy transition
Driving efforts to fuel Indonesia’s clean energy transformation is Pertamina, the country’s leading state-owned energy corporation. Recognized by Sustainalytics as one of the top-ranked Environmental, Social, and Governance (ESG) oil and gas producers in the world, the company has implemented policies and strategic plans that prioritize a long-term positive impact on the environment and society while strengthening its commitment to supporting the nation’s emissions reduction efforts.
While Pertamina has taken clear steps to meet its green targets, the company has also pledged to ensure reliable and affordable energy security to Indonesia’s population while also powering the country’s economic growth. As part of this commitment, Pertamina’s dual growth strategy involves strengthening its legacy oil and gas business while concurrently developing low-carbon solutions through its subsidiaries and other green businesses to drive long-term development.
Accelerating green innovations
Acknowledging the importance of investing in green innovations, Pertamina New and Renewable Energy (Pertamina NRE) announced plans to increase its spending on new and renewable energy development and low-carbon solutions to $6.2 billion by 2029.
Part of the investment will go toward unearthing Indonesia’s vast geothermal potential. While Indonesia has access to 40% of global geothermal reserves—the largest of any nation in the world—most of it remains untapped, with geothermal utilization currently accounting for just 5% of the country’s total power generation. The ability to effectively harness this precious renewable resource would play a significant role in advancing Indonesia’s clean-energy transition. In pursuit of this goal, the Pertamina Geothermal Energy subsidiary has announced plans to optimize and expand development by adopting new business paradigms, leveraging innovative technologies, and increasing collaboration and diversification across its operations.
Meanwhile, to reduce Indonesia’s reliance on oil and gas imports, Pertamina aims to scale up its biofuel development. Since 2010, the company has been progressively producing biodiesel, achieving a B35 blend in 2023, which it continues to produce to this day. The use of this palm oil-based biofuel helped reduce 32.7 million tons of CO2 emissions in 2023. With more investments into its clean-energy businesses, Pertamina plans to continue expanding its biofuel portfolio. The company has already started looking at replicating its success with biodiesel for gasoline products and is testing different bioethanol products, including a 100% bioethanol derived from sorghum. It is also actively advancing the development and distribution of its sustainable aviation fuel called Pertamina SAF to power the aviation industry in Indonesia and beyond. As part of these efforts, Virgin Australia Airlines utilized Pertamina SAF during the Bali International Air Show in September 2024.
Another cornerstone of Pertamina’s roadmap to net zero emissions is the construction of a comprehensive electric vehicle (EV) ecosystem. With the transportation sector accounting for approximately 27% of Indonesia’s total greenhouse gas emissions, the government has set a target to deploy 2 million electric cars and 13 million electric motorbikes by 2030—a move that would not only contribute greatly to decarbonization efforts but would also position the nation as a key player in the EV supply chain. To support Indonesia’s electrification drive, Pertamina has announced its commitment to building a robust EV infrastructure that encompasses vehicles, charging stations, battery packs, fleet-operator development, and other sustainable mobility solutions.
Fostering a resilient energy future
Pertamina is a crucial player in Indonesia’s energy transition, and its significance is underscored by the progress it has made in decarbonization efforts. By implementing various carbon-conscious practices across all its operations and sub-holdings, the company was able to surpass its initial targets and reduce its scope 1 and scope 2 emissions by 1.13 million tons in 2023.
Beyond reducing its own operational emissions, Pertamina has also been supporting Indonesia’s industrial decarbonization through carbon trading. Since becoming the first carbon credit seller on the Indonesia Carbon Exchange, Pertamina NRE’s carbon credit sales volume has increased to approximately 565,000 tons, accounting for 93% of the country’s market share.
Learn more about Pertamina’s push toward clean energy.
