Infrastructure & PPPs in Indonesia - Q2 2026 Update

YOG INFRA
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INDONESIA is accelerating infrastructure, renewable energy, and digital infrastructure development through a combination of public investment, private capital, and Public-Private Partnership (PPP). Major initiatives include the USD 67.2 Bn national railway expansion programme, the USD 1.05 Bn Central Java toll road, and growing investments in AI-ready data centres, strengthening the country's transport connectivity and digital economy. Indonesia is also advancing its energy transition through a 100 GW solar programme, large-scale renewable energy investments, and green industrial initiatives, reinforcing its focus on energy security, decarbonization, and long-term sustainable economic growth.

Read more about key developments in Infrastructure and PPPs in Indonesia in our latest insight.

APRIL 2026

GARUDA YAMATO STEEL LAUNCHES LARGE-SCALE SOLAR PLANT TO ADVANCE GREEN STEEL

PT Garuda Yamato Steel (GYS), one of Indonesia’s leading integrated steel manufacturers, has commissioned its first large-scale solar power facility in partnership with iForte Energi, marking a major step toward sustainable steel production. The newly installed solar system spans approximately 55,000 square meters and has a total capacity of 6.5 MWp, making it one of the most significant renewable energy deployments in Indonesia’s steel sector.

The solar installation is designed to supply clean electricity to key manufacturing operations, including steel melting shops, rolling mills, warehouses, and administrative buildings. By integrating renewable energy into its operations, the company aims to significantly reduce greenhouse gas emissions and contribute to Indonesia’s broader push toward greener industrial practices.

CENTRAL JAVA TOLL ROAD PROJECT SECURES USD 1.05 BN FINANCING

PT Sarana Multi Infrastruktur is leading a syndicated loan worth IDR 17.9 Trn (USD 1.05 Bn) to finance the Yogyakarta–Bawen toll road project in Central Java, Indonesia.

The financing agreement brings together multiple banking institutions to support the development of the 75 km toll road, which is expected to enhance regional connectivity and improve transport efficiency across Central Java. The Yogyakarta–Bawen toll road forms part of Indonesia’s broader infrastructure expansion strategy, aimed at strengthening inter-city links, reducing travel time, and supporting economic activity in key growth corridors.

PT Sarana Multi Infrastruktur acting as the lead arranger, the project reflects continued reliance on blended and syndicated financing models to fund large-scale transport infrastructure in Indonesia.

TOTALENERGIES AND MASDAR TO FORM USD 2.2 BN JOINT VENTURE TO ACCELERATE RE GROWTH IN ASIA

TotalEnergies, a global integrated multi‑energy company, and Abu Dhabi Future Energy Company PJSC – Masdar, a global clean energy leader, have signed a binding agreement to establish a USD 2.2 Bn joint venture (JV) that will merge their onshore renewable activities in nine countries across Asia.

As electricity demand accelerates across Asia, this partnership brings together capital and expertise to deliver renewable energy at the scale and speed required. Once the transaction is closed, the JV will act as both companies' sole vehicle for developing, building, owning and operating onshore solar, wind and battery storage projects in Azerbaijan, Indonesia, Japan, Kazakhstan, Malaysia, the Philippines, Singapore, South Korea and Uzbekistan. The JV will have a portfolio capacity of 3 GW of operational assets and 6 GW of assets in advanced development that are expected to be operational by 2030

INDONESIA SETS 100 GW SOLAR TARGET TO STRENGTHEN ENERGY SECURITY

The Government of Indonesia is accelerating its renewable energy ambitions, with plans to deploy up to 100 GW of solar capacity by 2028 as part of efforts to strengthen energy security amid global supply disruptions.

The initiative includes the parallel rollout of battery energy storage systems to support grid stability and reduce reliance on fossil fuels. The push comes as geopolitical tensions in the Middle East continue to impact global energy markets, prompting Indonesia to diversify its energy mix and reduce exposure to imported fuels.

Renewable energy currently accounts for around 16% of Indonesia’s energy mix, with solar contributing just 1.7%, while coal continues to dominate. State utility Perusahaan Listrik Negara has also been identified as a critical bottleneck, with delays in procurement processes and unclear tariff frameworks affecting project viability and private sector participation. Without clear pricing structures and updated planning frameworks, large-scale deployment may face further delays.

The government estimates that approximately USD 78 Bn will be required to achieve the 100 GW target, with officials emphasizing the need to improve investment conditions and ensure projects are financially viable. At the same time, Indonesia continues to pursue complementary energy strategies, including expanding biofuels and geothermal energy, while maintaining coal as a backup energy source.

MAY 2026

KAI, SURGE AND HUAWEI TO DEPLOY 5G AND AI IN INDONESIA’S RAILWAY SYSTEM

PT Kereta Api Indonesia, PT Solusi Sinergi Digital and Huawei have signed a tripartite memorandum of understanding (MoU) to accelerate the deployment of 5G and AI technologies across Indonesia’s rail network.

The collaboration focuses on three core areas: strengthening ICT infrastructure, deploying 5G-based Future Railway Mobile Communication Systems (FRMCS), and introducing AI-powered applications for railway operations. Planned initiatives include high-reliability communication networks, intelligent dispatching systems and pilot projects on the Rangkasbitung–Tanah Abang corridor to enhance level-crossing safety and operational efficiency.

The partnership will also implement AI-driven video analytics for freight operations, enabling real-time fault detection and automated alerts to reduce manual inspections and improve asset utilization. These technologies are expected to enhance safety, optimize performance and support predictive maintenance across the network.

The initiative aligns with Indonesia’s broader digital transformation agenda, positioning advanced connectivity and intelligent systems as key enablers of next-generation railway operations. It also reflects increasing adoption of integrated 5G and AI solutions in transport infrastructure to improve service reliability and passenger experience.

ZTE AND TELKOM INDONESIA TO ACCELERATE DIGITAL SOLUTIONS AND INFRASTRUCTURE DEVELOPMENT

ZTE Corporation and PT Telkom Indonesia (Persero) Tbk have signed a memorandum of understanding (MoU) to strengthen strategic cooperation in the development of digital solutions and infrastructure in Indonesia. The agreement focuses on accelerating Indonesia’s digital transformation through the deployment of technologies including cloud computing, artificial intelligence and next-generation connectivity solutions.

Under the partnership, ZTE will support Telkom Indonesia through its capabilities in digital infrastructure, AI-driven platforms and integrated communication technologies. The collaboration will explore projects related to digital infrastructure development, enterprise solutions, AI-enabled services and capability building. Telkom also plans to strengthen its digital ecosystem through expanded investments in data centres, connectivity infrastructure and cloud-based platforms.

The agreement forms part of Telkom Indonesia’s broader strategy to transition from a traditional telecommunications operator into a digital infrastructure and platform-focused enterprise. The partnership is expected to support the development of scalable and secure digital services for enterprise and government sectors while contributing to the growth of Indonesia’s digital economy. Both companies also indicated that the cooperation would support long-term value creation and regional digital ecosystem development across Southeast Asia.

INDONESIA, MALAYSIA FIRMS TO DEVELOP BIOGAS AND WTE PROJECTS

Indonesia’s Lampung Provincial Government has signed a memorandum of understanding (MoU) with Malaysian company Citaglobal Berhad to develop waste-to-energy (WtE) and renewable energy (RE) projects in Lampung province. The partnership aims to convert urban and industrial waste into power as part of efforts to build a green industrial ecosystem and promote circular economy practices in the region.

The collaboration includes the development of a waste-to-energy facility using German technology to process municipal waste and generate electricity for the local grid. In addition, the partners will explore the conversion of agricultural residues, including Palm Oil Mill Effluent, into biogas for industrial power generation. The agreement also covers feasibility studies for floating solar projects on three dams in the province, each with an estimated capacity of 150 MW to 200 MW.

Lampung has been identified by the Indonesian central government as a priority region for integrated environmental and renewable energy solutions due to its strategic logistics position and proximity to the national capital.

ASTRINDO, HUMPUSS PLAN USD 1.5 BN INVESTMENT IN ENERGY IN INDONESIA

PT Astrindo Nusantara Infrastruktur Tbk. and PT Humpuss have signed a memorandum of understanding (MoU) to explore the development of five energy and industrial projects in Indonesia with a combined estimated investment value of USD 1.5 Bn. The agreement establishes a framework for feasibility studies, technical evaluations, commercial assessments and investment structure discussions for the proposed projects.

The projects under evaluation include the reactivation of a catalytic polymerization unit, a reformate addition project, a crude palm oil refinery for cooking oil production, mini liquefied natural gas facilities and a geothermal-powered data centre and power plant project in Sabang. The collaboration is aimed at developing a more integrated and sustainable national energy ecosystem while supporting industrial and digital infrastructure growth.

Astrindo Nusantara Infrastruktur indicated that projects related to cleaner energy solutions, including mini-LNG infrastructure and geothermal-powered data centres, align with the company’s broader strategy focused on environmentally sustainable energy development and ESG principles.

JUNE 2026

INDONESIA ADVANCES 100 GW SOLAR POWER PROGRAMME TO ACCELERATE RE TRANSITION

The Government of Indonesia has announced plans to develop 100 GW of solar power capacity before 2029 as part of its broader strategy to expand renewable energy generation, strengthen energy security and support long-term decarbonization objectives. The programme targets the deployment of 80 GW of distributed solar capacity and 20 GW of utility-scale solar projects across the country.

The initiative forms a key component of Indonesia’s goal of achieving a fully renewable energy-based power system by 2035 and reaching net-zero emissions by 2060 or earlier. The Institute for Essential Services Reform (IESR) has highlighted several priority areas to support implementation, including accelerating the replacement of diesel-powered generation, particularly in remote and island communities. State-owned utility PLN aims to reduce diesel-based electricity generation by 80% by 2030 through greater integration of solar power and battery energy storage systems. IESR has also recommended packaging smaller renewable energy projects into larger investment opportunities to attract private sector participation.

BDX SECURES 1.2 GW POWER PORTFOLIO FOR DATA CENTRE EXPANSION IN INDONESIA

BDX Data Centers has secured a total power portfolio of 1.2 GW in Indonesia through its strategic partnership with state-owned utility PT Perusahaan Listrik Negara (PLN), marking the largest power commitment secured by a data centre operator in the country. The milestone strengthens Indonesia’s capacity to support artificial intelligence, cloud computing and hyperscale digital infrastructure development.

The expansion includes 788 MVA of contracted grid power for BDx’s CGK4 AI Campus in Jatiluhur, West Java, a major capacity increase to approximately 60 MVA at the CGK3A facility in South Jakarta, and up to 385 MVA of secured power capacity for the CGK5 campus in Suryacipta, West Java. Together, these projects form part of BDx’s broader strategy to develop large-scale digital infrastructure capable of supporting enterprise, hyperscale and sovereign AI workloads across Indonesia.

CGK4, which is positioned as Indonesia’s first NVIDIA DGX-Ready-certified data centre campus, is designed to provide up to 650 MW of renewable-aligned capacity and support advanced AI computing applications. CGK3 is equipped for high-density and liquid-cooled computing environments, while CGK5 will further expand hyperscale data centre capacity in West Java. The collaboration supports Indonesia’s ambitions to become a regional hub for artificial intelligence and digital services while ensuring access to reliable and scalable power infrastructure.

STT GDC SECURES USD 500 MN FOR JAKARTA DATA CENTRE CAMPUS

ST Telemedia Global Data Centres (STT GDC), one of the world’s fastest-growing data centre colocation service providers headquartered in Singapore, Announced the successful expansion of Indonesia financing platform, supporting the continued development of the STT Jakarta data centre campus, including STT Jakarta 3. The upsized dual-currency facility of IDR 8.8 Trn (USD 500 Mn) includes a maiden green term loan tranche, marking the Company’s first green financing in Indonesia.

The green tranche will be deployed to support the construction of STT Jakarta 3, located in Cikarang, Bekasi. The facility forms part of the broader STT Jakarta campus which will support more than 360MW in IT capacity once fully built out and is designed to meet increasing demand for cloud, AI and high-performance computing workloads in Indonesia.

STT Jakarta 3 is designed with the flexibility to support both liquid and advanced air-cooling architectures, enabling next-generation workloads at higher densities .Designed in line with defined sustainability performance criteria, STT Jakarta 3 is targeting a power usage effectiveness (PUE) of 1.30 and LEED Gold certification, and will deploy an ultra-low Global Warming Potential (GWP) cooling system.

INDONESIA AND SINGAPORE DEEPEN GREEN ENERGY AND DIGITAL INFRASTRUCTURE PARTNERSHIP

The Governments of Indonesia and Singapore have expanded their economic cooperation through new initiatives focused on renewable energy and digital infrastructure following the 16th Singapore–Indonesia Six Bilateral Economic Working Groups Ministerial Meeting in Jakarta. A key development is a planned utility-scale solar project at the Indonesia Morowali Industrial Park in Central Sulawesi, being developed by Sembcorp Utilities, PT Sumber Energi Surya Nusantara and the Indonesia Investment Authority.

The project will involve an investment of USD 210 Mn and include a 200 MW solar power plant supported by an 80-MWh battery energy storage system. Scheduled to begin operations in Q1 2027, the facility will provide clean electricity to industrial users and support Indonesia’s renewable energy transition.

The two countries are also strengthening cooperation in digital infrastructure through a joint study examining opportunities to develop Batam, Bintan and Karimun as a regional digital hub. The initiative is supported by ongoing investments in data centres across the Riau Islands, including developments by DayOne, PT Equator Gate System and DCI Indonesia. Authorities are also exploring greater integration between Singapore, Johor and Riau as a connected data centre ecosystem.

INFRASTRUCTURE ASIA TO ADVANCE SUSTAINABLE INFRASTRUCTURE PROJECTS ACROSS ASIA

Infrastructure Asia signed four memorandums of understanding (MoUs) with the Indonesia Infrastructure Guarantee Fund, the Public-Private Partnership Center of the Philippines, the Private Infrastructure Development Group and the World Bank Group during the Asia Infrastructure Forum (AIF) 2026 in Singapore. The agreements aim to strengthen regional collaboration, improve project bankability and mobilize financing for sustainable infrastructure projects across Asia through innovative funding and project development mechanisms.

The signing coincided with the presentation of more than 15 infrastructure projects spanning the energy, transport and circular economy sectors, with a combined estimated value exceeding USD 16 Bn. Featured projects included the Metro Manila Subway Project in the Philippines, the Madhya Pradesh Battery Energy Storage System Programme in India and the Intermediate Treatment Facility Sunter Waste-to-Energy Project in Indonesia. The projects comprise both greenfield developments and expansion initiatives and are expected to enter the market.

The MoUs will support project preparation, advisory services, capacity building and knowledge sharing among infrastructure stakeholders. Infrastructure Asia and its partners will work to enhance project structuring, facilitate private sector participation and provide greater visibility into regional infrastructure pipelines. Global estimates indicate that infrastructure investment needs could reach USD 106 Trn by 2040, with Asia accounting for approximately two-thirds of total demand.

INDONESIA PLANS USD 67.2 BN RAILWAY EXPANSION PROGRAMME THROUGH 2045

The Government of Indonesia has announced plans to invest approximately IDR 1,200 Trn (USD 67.2 Bn) to expand and revive its railway network by 2045, with the objective of developing around 14,000 km of new and reactivated railway lines across the country. The programme forms part of Indonesia’s Vision 2045 strategy and focuses primarily on improving rail connectivity outside Java, including in Sumatra, Kalimantan and Sulawesi.

The programme is expected to require annual investment of approximately IDR 60-65 Trn (USD 3.36-3.64 Bn) over the next two decades. Funding is expected to come from a combination of national and regional government budgets, Public-Private Partnership (PPP), domestic private investment, foreign investment and international cooperation initiatives.

The expansion plan aims to address significant railway infrastructure gaps across the archipelago. Sumatra currently operates approximately 1,871 km of railway lines but requires an additional 7,837 km to meet future connectivity needs. Kalimantan currently has no operational railway network and is estimated to require at least 2,772 km of new rail infrastructure, while Sulawesi has 109 km of railway and requires a further 3,284 km to strengthen regional mobility and economic integration.

Development will be implemented in phases, combining medium- and long-term projects with early priority initiatives. One project under consideration is a railway connection between Banda Aceh and Besitang in North Sumatra to improve strategic regional connectivity. The government also plans to pursue innovative financing mechanisms while strengthening domestic industrial capabilities to support sustainable railway development.

TOTALENERGIES ENEOS EXPANDS ROOFTOP SOLAR PROJECT WITH CERES IN INDONESIA

TotalEnergies ENEOS Renewables Distributed Generation Asia Pacific has successfully completed Phase 2 of a rooftop solar photovoltaic (PV) project with PT. Perusahaan Industri Ceres (Ceres), a leading chocolate confectionery manufacturer in Indonesia, at its Bandung facility.

The latest expansion follows the commissioning of the first 2.2 megawatt-peak (MWp) system in September 2024. Phase 2 adds 1.4 MWp of additional capacity, generating over 1,380 megawatt-hours (MWh) of renewable electricity annually. With both phases combined, the rooftop solar installation now reaches a total capacity of 3.6 MWp, producing approximately 4,630 MWh of clean energy each year. This output is expected to meet nearly 12% of Ceres’ total electricity demand while significantly reducing its carbon footprint.

The project is structured under a 15-year long-term agreement, wherein TotalEnergies ENEOS is responsible for developing, financing, constructing, and operating the solar system. Under this model, Ceres pays only for the electricity generated, without any upfront capital investment, enabling cost savings alongside emissions reduction.

AIIB OPENS INDONESIA OFFICE TO SUPPORT USD 17 BN GREEN INVESTMENT

The Asian Infrastructure Investment Bank (AIIB) is set to establish its first representative office in Indonesia after securing a massive USD 17 Bn project financing commitment with the Indonesian government. The government will provide unused state land and buildings to support the multilateral bank’s physical presence in the country.

The funding is structured as a dedicated project financing facility rather than a conventional state debt instrument. Designed to be utilized in stages through 2029, the capital carries lower interest rates than regular commercial investments, while ensuring the resulting infrastructure assets remain state property. The physical office is expected to streamline communication and accelerate project approval pipelines for these multi-billion-dollar developments.

This expansion aligns with the AIIB’s broader strategic push for bold investment in green infrastructure and regional connectivity. The bank has emphasized that Asia must accelerate its transition to renewable energy and digital networks to withstand climate risks and economic uncertainty. The AIIB has already financed approximately USD 2 Bn in renewable energy and battery energy storage systems (BESS) across South and Southeast Asia.

INDONESIA EXCEEDS 2026 RENEWABLE ENERGY TARGET

Indonesia’s renewable energy share in electricity generation reached 17.89% in Q2 2026, surpassing the government’s full-year target of 16.46%. Renewable electricity production totalled 29.62 terawatt-hours during the first four months of the year, reflecting steady growth from 14.65% in 2024 and 15.75% in 2025. The increase has been supported by the commissioning of new renewable energy projects, including hydroelectric power plants connected to the national grid.

Hydropower remains Indonesia’s largest renewable energy source, followed by biomass and geothermal energy, while solar power is recording the fastest growth due to falling photovoltaic costs and the expansion of rooftop solar installations. Sumatra has emerged as a leading renewable energy region, with clean energy accounting for 41.76% of its electricity generation through abundant hydro, geothermal and biomass resources. Under the national Electricity Supply Development Plan 2025–2034, renewable energy is expected to account for approximately 76% of all new electricity generation capacity.

The rapid expansion of renewable energy is strengthening Indonesia’s energy transition while attracting greater interest from international investors. The government continues to priorities the expansion of transmission infrastructure and the gradual reduction of coal dependence as it advances long-term decarbonization and supports sustainable growth in the national power sector.

List of key transactions - Indonesia Q2 2026

Source: YOG INFRA, Public Information

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