Indonesia’s 100 GW Solar Program Aims To Electrify Villages And Cut Diesel Dependence

In August 2025, the Indonesian government announced an ambitious plan to deploy 100 GW of solar energy along with 320 GWh of battery storage under its landmark “100 GW Solar Program.” The initiative aims to provide clean and reliable electricity to nearly 80,000 villages across the country while addressing long-standing challenges such as high power costs, unreliable supply, and unequal access to electricity across the archipelago.

Under the program, around 80 GW of solar capacity will be developed through village-level solar mini-grids, each of roughly 1 MW, supported by battery storage and managed by local village cooperatives. The remaining 20 GW will come from centralized solar power plants connected to the main grid. This large-scale shift is significant for Indonesia, where fossil fuels still account for more than 80 percent of electricity generation and over 3,200 villages remain without access to power.

A key objective of the program is “de-dieselization,” or replacing thousands of diesel generators currently used in remote and island communities. These generators are expensive to operate and heavily subsidized by the government, costing Indonesia billions of dollars each year. By gradually redirecting diesel subsidies toward investments in solar and battery systems, the government expects to reduce long-term costs while improving energy security and cutting emissions.

To shape effective policies, Indonesia is studying international examples. In Brazil, innovative auctions for isolated power systems in the Amazon region have shown that solar and battery “heavy-hybrid” systems are now more cost-effective than diesel as the main energy source. In the Philippines, funds collected through a “Universal Charge” have been redirected to offer cash incentives for renewable energy developers serving off-grid areas.

Indonesia’s geography presents unique challenges, as thousands of islands are spread over a vast area. International experience shows that settlement-scale systems, where villages share infrastructure such as rooftops, inverters, and batteries, can be around 35 percent cheaper than installing individual household systems. Thailand’s Koh Jik ReCharge project is one such example, where a community-run solar and battery system cut diesel use by 80 percent on a small island.

The program also looks to improve grid reliability, which currently lags behind the ASEAN average. Concepts such as community solar and Virtual Power Plants are being considered. Virtual Power Plants combine many small energy systems to support the grid by managing peak demand and improving stability, reducing the need for costly grid upgrades.

Beyond domestic benefits, the transition is important for Indonesia’s export competitiveness. With measures like the European Union’s Carbon Border Adjustment Mechanism approaching, access to clean power is becoming critical for exporters. By learning from global practices such as power wheeling and Renewable Energy Certificates, Indonesia aims to turn its 100 GW solar target into a foundation for a more affordable, reliable, and sustainable power sector.