Indonesia awards geothermal concessions to EDC - Eco-Business
Published January 17, 2026
Indonesia Grants Geothermal Concessions to Energy Development Corporation
Indonesia has officially awarded geothermal concessions to the Energy Development Corporation (EDC), a significant step in the nation’s pursuit of renewable energy development. The announcement was made during a formal ceremony, marking a pivotal moment for both Indonesia and EDC as they aim to harness the country's vast geothermal resources.
The geothermal concessions encompass several key areas, which are expected to play a crucial role in Indonesia's energy transition strategy. These concessions are part of the government's broader initiative to increase the share of renewable energy in the national energy mix, targeting a 23% contribution by 2025.
Details of the Concessions
The awarded concessions cover a total area of approximately 10,000 hectares across various provinces, including North Sumatra and West Java. These regions are known for their high geothermal potential, with estimates suggesting that Indonesia holds around 40% of the world’s geothermal resources. The EDC is set to invest significantly in the development of these sites, which are anticipated to generate substantial amounts of clean energy.
According to the Ministry of Energy and Mineral Resources, the geothermal projects are expected to contribute an additional 1,000 megawatts (MW) of power to the grid. This addition is crucial as Indonesia seeks to meet its growing energy demands while reducing reliance on fossil fuels.
Significance of Geothermal Energy in Indonesia
Geothermal energy is a vital component of Indonesia's renewable energy landscape. With over 29 active geothermal power plants, the country currently ranks second globally in geothermal energy production, following the United States. The government aims to capitalize on this potential by encouraging foreign investments and partnerships, as demonstrated by the recent agreement with EDC.
Geothermal energy offers several advantages, including its reliability and low environmental impact compared to traditional fossil fuels. The development of geothermal resources also aligns with Indonesia's commitment to reducing greenhouse gas emissions and achieving its climate targets under the Paris Agreement.
Energy Development Corporation's Role
The Energy Development Corporation, based in the Philippines, has a long-standing reputation in the renewable energy sector, particularly in geothermal energy development. With over 40 years of experience, EDC has successfully developed and operated geothermal power plants, making it a valuable partner for Indonesia's renewable energy ambitions.
EDC's expertise in geothermal technology and project management is expected to enhance the efficiency and sustainability of the new projects. The corporation has committed to employing local labor and resources wherever possible, which will contribute to the economic development of the regions involved.
Government Support and Future Plans
The Indonesian government has expressed strong support for the geothermal sector, implementing various policies to facilitate investment and development. These include streamlined permitting processes, financial incentives, and a commitment to purchasing power generated from renewable sources at competitive rates.
In addition to the concessions awarded to EDC, the government is actively exploring other geothermal opportunities across the archipelago. This includes conducting feasibility studies and engaging with other potential investors to further develop Indonesia's geothermal capacity.
Conclusion
The awarding of geothermal concessions to the Energy Development Corporation represents a significant advancement in Indonesia's renewable energy sector. With the potential to generate 1,000 MW of clean energy, these projects will not only bolster the national energy supply but also contribute to the country’s environmental goals. As Indonesia continues to develop its geothermal resources, partnerships with experienced companies like EDC will be essential in driving the transition towards a more sustainable energy future.
As the world increasingly shifts towards renewable energy, Indonesia's commitment to harnessing its geothermal potential positions it as a leader in the sector. The collaboration with EDC is a promising development that could pave the way for further investments and innovations in geothermal energy, ultimately benefiting both the economy and the environment.
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