Infrastructure & PPPs in Indonesia - Q3 2025 Update
- YOG INFRA
- Oct 6
- 13 min read
YOG INFRA Q3 2025 insight series
INDONESIA is actively developing infrastructure projects across various sectors, including ongoing development of the new capital city, Nusantara. These projects call for large investments through use of both public funds and private sector particiaption. Some key sectors electric mobility, aolar, geothermal, BESS, airports, metro/ LRT, waste management etc.
Read more about key developments in Infrastructure and PPPs in Indonesia in our latest insight.
JULY 2025
ITDP INDONESIA RELEASES ROAD MAP TO TRANSITION TO ELECTRIC PUBLIC TRANSPORT
The Government of Indonesia’s Ministry of Transportation, in partnership with the Institute for Transportation and Development Policy (ITDP) Indonesia, has released a road map to transition to an electric public transport system in three cities in the country. The cities are Surabaya, Surakarta, and Pekanbaru. These cities collectively have a fleet of around 330 buses.
Key recommendations include:
Transitioning to more efficient and performance-oriented contract models tailored to each city’s fiscal and institutional capacity.
Deploying bus models and adopting contract models that lower the operational cost per km.
Developing charging infrastructure.
Enhancing the quality of services by developing better bus stop facilities & priority bus lanes.
Adopting integrated fare collection systems.
CATL, PARTNERS LAUNCH USD 6 BN BATTERY MEGA PROJECT IN INDONESIA
Contemporary Amperex Technology Company Limited (CATL) and its partners—Brunp, Indonesia Battery Corporation (IBC), and state miner PT Aneka Tambang (ANTAM)—have broken ground on the landmark USD 6 Bn Indonesia Battery Integration Project in Karawang, West Java. The project spans the full battery value chain, from nickel mining and materials processing in North Maluku to battery manufacturing and recycling across industrial parks in Karawang. Phase 1 will deliver 6.9 GWh in annual battery capacity, leveraging CATL’s advanced Lighthouse Factory approach. Once operational, the project aims to produce 142,000 tons of nickel, 30,000 tons of cathode materials, and recycle 20,000 tons of used batteries annually.
The integrated complex is designed to support Indonesia’s 2060 carbon neutrality goals and the global shift to clean mobility. It will create 8,000 direct and 35,000 indirect jobs, introduce a renewable energy circular system, and boost local capacity for high-efficiency battery manufacturing.
ACWA POWER SIGNS CLEAN ENERGY PARTNERSHIPS IN INDONESIA
ACWA Power Co. has signed a Memorandum of Understanding (MoU) with Indonesian sovereign wealth fund Badan Pengelola Investasi Daya Anagata Nusantara (Danantara Indonesia) to explore investments in Indonesia focused on projects in renewable energy generation, combined cycle gas turbines, green hydrogen and water desalination.
In addition, the Saudi power generation and water desalination company has signed a strategic partnership with Indonesian state-owned oil and gas corporation PT Pertamina for the joint development of clean energy projects in Indonesia, including 500 MW of renewable energy and gas-to-power projects, new electricity tender and green hydrogen projects.
The pact represents a total project funding of up to USD 10 Bn. It will help Indonesia meet its target of a 34% renewables share in its energy mix by 2034 and 87% by 2060, while deepening the company’s presence in Indonesia’s power and water sector. The partnership brings both capital and expertise to accelerate high-impact projects in solar, hydrogen, and integrated water- energy solutions.
INDONESIA PLANS TO LAUNCH FLYING TAXI SERVICES IN NUSANTARA BY 2028
The Government of Indonesia aims to begin operations of electric air taxis in Nusantara, the country’s upcoming capital in East Kalimantan, by 2028. The initiative will deploy the autonomous EHang 216-S flying taxis as part of plans to establish Nusantara as a smart and sustainable city.
The 216-S is an AI-operated aerial vehicle with a top speed of 130 km/hr and a payload capacity of 220 kg. Each unit costs around USD 535,000 but has significantly lower operational costs than helicopters—about USD 30 per full charge. The government envisions the air taxi as a practical, green alternative for intra-city travel and a boost to tourism in Nusantara. The trial was supported by Prestige Aviation, which brought the EHang 216-S to Indonesia.
INDONESIA SIGNS NINE NEW PROJECTS FOR IKN PHASE 2 DEVELOPMENT
The Nusantara Capital Authority (OIKN) has signed agreements for nine new projects under Phase 2 of the development of Indonesia’s new capital, IKN, located in East Kalimantan’s Penajam Paser Utara and Kutai Kartanegara districts. These include seven road infrastructure packages and projects for sports areas, green open spaces, and community-focused development in Sepaku.
The Sepaku area project, valued at IDR 313.2 Bn (USD 19 Mn approx.), involves participatory planning for infrastructure like the local market. A 12.3-km road improvement project, worth IDR 3.04 Trn (USD 188 Mn), is also part of the phase. The glamping and green space projects aim to create recreational and educational zones in the tropical forest area.
INDONESIA GREEN LIGHTS NORTH BALI AIRPORT PROJECT
The Government of Indonesia has approved the long-delayed construction of the North Bali International Airport (BIBU), aiming to ease pressure on the overburdened Ngurah Rai International Airport and balance regional development in Bali. The plan, first proposed in 2015, targets an annual passenger capacity of 50 million. The project has an estimated cost of IDR 50 Trn (USD 3 Bn).
The project aims to address the development gap between northern and southern Bali. While areas like Denpasar and Badung attract most tourists and investment, northern regions such as Buleleng remain underserved. Ngurah Rai Airport, operating near its 24 million passenger capacity, cannot expand further due to land limitations. During peak travel seasons, it handles up to 400 flights per day.
To manage this and distribute economic activity, the government has included BIBU in the 2025–2029 National Medium-Term Development Plan (RPJMN). The proposed location spans a 900-hectare artificial island off Kubutambahan in Buleleng Regency. Plans also include a supporting toll road connecting to Mengwi and a rail link to Ngurah Rai Airport. The airport project will be part of a broader urban development, including hotels, a convention centre, and a film zone named “Baliwood.” The runway is expected to be operational by 2027.
INDONESIA APPROVES IDR 48.8 TRN BUDGET FOR NUSANTARA CAPITAL DEVELOPMENT THROUGH 2028
The Government of Indonesia has approved a total development budget of IDR 48.8 Trn (USD 2.95 Bn) for the ongoing construction of Nusantara, the country’s new capital in East Kalimantan, through 2028. The funding will support key infrastructure development during the second phase of the project, including facilities for the legislative and judicial branches.
The Nusantara Capital Authority (OIKN) announced that IDR 5.05 Trn (USD 305.99 Mn) is allocated for 2026, but a request has been made to raise this to IDR 21.18 Trn (USD 1.28 Bn) via an additional IDR 16.13 Trn (USD 977.38 Mn) proposal submitted to the Ministry of Finance. The additional funds aim to accelerate the construction of government offices and related infrastructure to ensure readiness by 2028. The project is part of Indonesia’s broader strategy to decentralise governance from Jakarta and develop a modern, resilient political capital.
JAKARTA’S EAST–WEST MRT LINE TENDER TO BE LAUNCHED BY 2025-END
Jakarta’s next major Mass Rapid Transit (MRT) expansion — a 24.5 km east–west corridor — will cost around IDR 50 Trn (USD 3 Bn). The line will stretch from Medan Satria in East Jakarta to Tomang in West Jakarta, featuring 21 stations and a new train depot.
Construction is slated to begin in 2026, with land acquisition and utility relocation already underway. An international tender is expected in October or November 2025, with Japan-based financing secured and local partnership requirements for foreign bidders. The operator is concurrently working on a northbound extension from the Hotel Indonesia Roundabout to Kota, now 50% complete. The 6-km segment, estimated at IDR 12 Trn (USD 739 Mn), is expected to finish by 2029.
PT MRT Jakarta reports significant benefits from the existing MRT line, including a reduction in traffic congestion and environmental damage, with estimated savings of IDR 4.1 Trn (USD 248.43 Mn) in avoided losses and travel time reductions.
CATL BATTERIES TO POWER INDONESIA-SINGAPORE GREEN ENERGY LINK
Battery maker CATL will supply up to 2.2 GWh of battery systems for a project in Indonesia. The energy will be sent from Indonesia to Singapore using solar power.
Vanda RE ordered the batteries. Vanda RE is a joint venture between Gentari International Renewables and Gurin Energy. CATL will build the batteries at its factory in Karawang, West Java. This supports Indonesia’s rule to use local materials and workers where possible.
The project is located in the Riau Islands. It includes a solar farm with a planned capacity of 2 gigawatts. Battery storage will be 4.4 gigawatt-hours. The solar and storage systems are part of a new energy trade route between Indonesia and Singapore. LONGI Asia-Pacific will supply solar panels. Black & Veatch will provide engineering support.
The project is one of several in Indonesia focusing on clean energy and export. Other projects are happening in less-reported areas. In West Nusa Tenggara, PT Tera Sol Global Energy is building a 6.5-megawatt solar plant. The company plans to increase it to 10 megawatts by 2026.
PERTAMINA NRE-PTPN III DEVELOP 3 MW SOLAR POWER PLANT IN SEI MANGKEI SEZ
State energy company PT Pertamina, through its subsidiary Pertamina New and Renewable Energy (NRE), has partnered with State plantation company PT Perkebunan Nusantara (PTPN) III to develop a 3-megawatt (MW) solar power plant (PLTS) in the Sei Mangkei Special Economic Zone (SEZ), North Sumatra. The project is being carried out under a Build-Operate-Transfer (BOT) scheme and is part of the national push for renewable energy development.
The 3 MW solar plant is expected to reduce emissions by up to 4,100 tons of CO₂e per year, totaling around 102,500 tons of CO₂e over the 25-year cooperation period. The clean energy will support industries operating in the Sei Mangkei SEZ and contribute to the implementation of the national electricity development plan (RUPTL). Pertamina NRE is also exploring energy innovations using plantation crops, aimed at expanding the clean energy ecosystem while delivering local economic benefits and enhancing national energy sovereignty.
In addition to the solar project, Pertamina NRE and PTPN III are also developing a 2.4 MW biogas power plant (PLTBg) in the same zone, utilizing palm oil mill effluent (POME) as its feedstock. This facility is expected to generate up to 66,000 tons of carbon credits.
AUGUST 2025
INDONESIA, FRANCE AGREE TO CO-DEVELOP GREATER BANDUNG LRT PROJECT
The Governments of Indonesia and France have agreed to jointly develop the Greater Bandung Light Rail Transit (LRT) system in West Java as part of efforts to expand bilateral cooperation in transport infrastructure. The Greater Bandung LRT project aims to connect key areas in Bandung with the Whoosh high-speed rail station in Tegalluar. It is expected to ease traffic congestion and improve intermodal connectivity.
The estimated project cost is IDR 26 Trn (USD 1.6 Bn), which includes supporting infrastructure. The Construction is slated to begin in 2027. The estimated project cost is IDR 26 Trn (USD1.6 Bn), including infrastructure. The agreement includes knowledge-sharing, technology transfer, and participation from both French and Indonesian firms. A joint working group will be established to oversee implementation. The two countries also plan to enhance cooperation in maritime safety, port development, and aviation, including expanding direct flights and advancing airport infrastructure.
PERTAMINA & PLN TO DEVELOP 530 MW GEOTHERMAL PROJECTS IN INDONESIA
Indonesia’s state-owned energy company PT Pertamina and state electricity provider PT PLN have entered an agreement to develop 19 geothermal energy projects, collectively generating 530 MW. This effort supports Indonesia’s goals of energy independence and a shift toward renewable energy sources. The investment amount for these projects reach USD 5.4 Bn.
The collaboration involves creating effective partnership models, leveraging each company’s geothermal working areas (WKP), coordinating and expediting project timelines. It will also focus on performing technical and economic viability assessments, as well as forming a joint task force and committee to oversee implementation. PT Pertamina Geothermal Energy (PGE) and PT PLN Indonesia Power (PLNIP) signed a head of agreement to advance geothermal energy for electricity generation.
A consortium agreement was established between PGE and PLNIP for the Ulubelu Bottoming and Lahendong Bottoming Units to secure Independent Power Producer (IPP) projects, aligning with PGE’s plan to achieve a 1 GW capacity in two to three years. The Ulubelu BU (30MW) and Lahendong BU (15MW) are prioritised in this strategy. The initiative is anticipated to contribute to economic development at both local and national levels.
INDONESIA TARGETS 80-100 GW SOLAR ENERGY THROUGH NEW PROGRAMME
The government of Indonesia has launched Red and White Village Cooperative through which it aims to accelerate the energy transition and want to build solar power that is 1.0 - 1.5 GW per village. So, in the future, Indonesia will build approximately 80-100 GW in solar power. This is part of the government's effort to strengthen the role of new and renewable energy in the country's energy mix, while reducing its dependence on fossil fuels.This target cannot be achieved by solely relying on domestic solar panel production capacity. Domestic solar panel manufacturing is currently limited at around 5.0 GW per year. Therefore, Indonesia seeks foreign investors, who can also team up with Indonesian entrepreneurs and state-owned enterprises (SOEs), including Perusahan Listrik Negara (PLN).
Solar power development under the Red and White Village Cooperative is also an opportunity for business players in the battery sector as these solar power plants will be built with a battery energy storage system (BESS). The solar plants only operate for a limited number of hours per day, and thus energy must be stored in batteries (to take over in the evening and at night).
Solar power plant development under the Red and White Village Cooperative will be carried out in stages. However, at this moment it is not clear when construction is to begin. If implemented effectively, the project could become Southeast Asia’s largest rural electrification and distributed renewable energy program.
IIF DISBURSES IDR 42.5 TRN FOR INFRASTRUCTURE PROJECTS
Indonesia Infrastructure Finance (IIF) has allocated IDR 42.5 Trn (USD 2.57 Bn) in financing for more than 150 strategic infrastructure projects, reinforcing its role as a key partner of the Government of Indonesia and the private sector in driving sustainable development and economic growth. Since its establishment in 2010, IIF has supported priority sectors including transport, energy, telecommunications, and clean water.
Recent financing has backed renewable energy projects with nearly 700 MWh of installed capacity, benefitting 693,000 households and reducing 4.81 million tons of CO2 emissions annually. The institution has also supported seven drinking water projects serving 6.7 million people.
Infrastructure development has been central to Indonesia’s transformation, from early investments in highways and irrigation to recent large-scale programs such as Trans-Sumatra, Trans-Kalimantan, and Trans-Papua highways, new airports, and the new capital city (IKN). With an electrification ratio of 99.83% and strong progress on SDG indicators, IIF will continue to apply ESG principles in financing projects that strengthen national connectivity and prepare for Golden Indonesia 2045.
SEPTEMBER 2025
ABB AND PLN SUKU CADANG TO STRENGTHEN THE RELIABILITY OF INDONESIA’S POWER PLANTS
ABB and PLN Suku Cadang (PLN SC) have extended their strategic frame agreement to enhance the reliability and modernisation of Indonesia’s power plants. The collaboration covers automation upgrades, retrofits, electrical and automation spare parts, flame scanners, digital solutions, maintenance, technical services, and lifecycle support. It aims to improve operational reliability, minimise outages, and support PLN SC’s projects nationwide.
Indonesia targets adding 42.6 GW of renewable energy by 2034 and developing a Supergrid to connect clean energy sources with demand centres. ABB and PLN SC emphasised that high-quality parts, technical support, and digital lifecycle services are crucial for maximising uptime and supporting long-term resilience. Both parties reaffirmed their commitment to modernising Indonesia’s power infrastructure and accelerating the shift to sustainable energy, with a focus on innovation and digitalisation.
INDONESIA TO ACCELERATE CONSTRUCTION OF WTE PLANTS
The Government of Indonesia has announced plans to revise regulations to accelerate the development of waste-to-energy (WtE) plants, aiming to convert municipal and industrial waste into electricity and reduce environmental impacts. This move is intended to fast-track energy transition goals, support sustainable power generation, and alleviate growing waste management challenges in urban areas.
The policy update follows earlier initiatives, including the near-completion of the world’s largest waste-to-fuel plant in North Jakarta’s Rorotan area, which targets municipal waste conversion and improved energy recovery. The regulatory changes are expected to simplify approvals, encourage private investment, and boost Indonesia’s renewable energy capacity through WtE technologies.
TANGERANG REGENCY TO BUILD SIX MRT STATIONS ON EAST–WEST LINE
The Tangerang regency administration has confirmed plans to construct six mass rapid transit (MRT) stations along the East–West line, part of Indonesia’s national strategic project (PSN). The line will connect Cikarang in West Java with Balaraja in Banten. The stations will be located in Bitung, Curug, Cikupa, and Balaraja districts, covering a stretch of 12–20 km.
In total, Greater Tangerang will host 11 MRT stations under the East–West corridor—six in Tangerang regency and five in Tangerang city. Greater Tangerang includes Tangerang city, South Tangerang, and Tangerang regency. The development will be jointly undertaken by the regional administrations and PT MRT Jakarta, the Jakarta city-owned operator.
The East–West line is designed to enhance connectivity between Jakarta and the western part of the metropolitan area, easing congestion and supporting regional growth. Alongside this, the North–South line is planned to extend service into South Tangerang, expanding MRT coverage further into the suburban regions of Jakarta’s metropolitan area.
SURABAYA COMMUTER RAIL PROJECT TO BREAK GROUND IN 2029
Indonesia plans to commence work on the Surabaya Commuter Rail Project in 2029, beginning with the Gubeng–Sidoarjo corridor. The first phase will be financed through a USD 250 Mn loan from Germany’s KfW Development Bank, underlining international support for enhancing urban rail in East Java.
The project is designed to improve regional mobility, reduce congestion, and offer sustainable transport options in the Greater Surabaya area. The Gubeng–Sidoarjo section will serve as the backbone of the commuter network, connecting residential and employment hubs while easing pressure on existing road infrastructure.
The Surabaya system forms part of Indonesia’s broader strategy to expand public transport networks beyond Jakarta, with future phases expected to extend coverage across the metropolitan region.
PERTAMINA STARTS CONSTRUCTION OF GREEN HYDROGEN PILOT PLANT AT ULUBELU GEOTHERMAL SITE IN INDONESIA
PT Pertamina Geothermal Energy (PGE) inaugurated the Ulubelu Green Hydrogen Pilot Project in Tanggamus Regency, Lampung. This facility is targeted to be able to produce up to ±100 kilograms of green hydrogen per day with an efficiency level of 82–88% using modern membrane electrolysis technology (Anion Exchange Membrane/AEM) which is more environmentally friendly, energy efficient, and efficient than conventional technology.
Through this project, PGE combines geothermal energy with modern electrolysis technology to produce efficient and sustainable green hydrogen. Aim is to establish Ulubelu as a center of innovation that can be replicated in other geothermal areas, while also opening up opportunities for utilization in low-carbon transportation and industry.
This groundbreaking marks PGE's first step in building a broader green business chain. Moving forward, the roadmap includes developing green ammonia and green methanol as energy solutions and raw materials for future industries. Through this step, PGE affirms its business transformation towards beyond electricity and beyond business, making geothermal the foundation of the clean energy supply chain while strengthening national energy security.
List of key transactions - Indonesia Q3 2025
Source: YOG INFRA, Public Information
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