ABB Research: Indonesia Encourages Acceleration Of Energy Transition Through Renewable Energy Adoption, Investment And Digital Integration

JAKARTA - The energy transition in Indonesia continues to grow rapidly. The main encouragement comes from the increasing use of renewable energy, increasing flow of investment, and increasingly integrated digital technology. This fact was revealed in the Asia Pacific Energy Transition Readiness Index 2025, an industrial research initiated by the Energy Industries ABB division.

As many as 40 percent of respondents in Indonesia stated that their company had adopted more than half of its energy needs from renewable sources (much higher than the regional average of only 25 percent. In the future, 87 percent of industry players believe the use of renewable energy will jump more than 20 percent in the next five years, surpassing the regional average which is at 77 percent.

This positive direction was also strengthened by regulatory reforms, including the Draft Law on New and Renewable Energy (RUU EBT 2025), which provides a clear regulatory foothold to expand green energy capacity in Indonesia.

The Asia Pacific Energy Transition Readiness Index 2025 is based on a survey of more than 4,000 cross-industry business leaders in 12 countries in the Asia Pacific region, including Indonesia, which implements automation, electrification, digitization and sustainability strategies. By measuring 20 indicators on the aspects of Strategy, Technology & Infrastructure, Finance, and Talenta (Employment), data for Indonesia show a rapid increase supported by national policy and increasing focus on digitalization.

Indonesia continues to show advanced steps in the course of its energy transition. A strong 2/3 climate policy, impacted investment, as well as optimism for innovative technologies such as AI and automation solutions are driving factors. Furthermore, cross-ecosystem collaboration, green skills development, and digitalization acceleration will be more crucial," said Abhinav Harikumar, Vice President of Energy Industries ABB division for Southeast Asia. in Jakarta, Wednesday, September 24.

Simultaneously, financial momentum is also getting more solid. As many as 86 percent of companies in Indonesia are now allocating more than 10 percent of their CAPEX on energy transition projects, far above the regional average which is at 73 percent. This reflects the increasingly rooted belief that transition investment is not only prospective, but also has a real impact in increasing the scale of renewable energy while at the same time encouraging the acceleration of the transition.

Meanwhile, technological innovation comes as the main accelerator. As many as 70 percent of respondents view technology as the biggest potential driver, slightly higher than the regional average of 65 percent. Artificial Intelligence (AI) and automation are seen as transformative by 47 percent of leaders, compared to 32 percent at the regional level.

At the same time, digitalization is the main investment priority for 47 percent of companies in Indonesia, affirming the urgency of modernizing network systems. For Indonesia, this shows that digital technology and automation are now seen as important elements to make renewable energy widely implemented, as well as an important element to modernize networks, systems, and infrastructure to encourage efficiency.

Energy transition is also a human-centered transformation, and collaboration is the key to strengthening future green talents'. As many as 30 percent of respondents stated that their company sees the need to get workers who can support the company's energy transition strategy and plan. To answer this, the company has also involved external partners in developing sustainability skills, especially through industrial groups (54 percent), international development organizations (43 percent), government institutions (33 percent), as well as universities and research institutions (30 percent).

Respondents also realized that collaboration is very important to maintain the sustainability of overall progress: One in four respondents assessed the private public partnership as an opportunity that has not been fully exploited, with increased investment in the private sector (61 percent), cross-government collaboration in network infrastructure (56 percent), as well as stronger incentives and subsidies (55 percent) referred to as areas that have great potential to accelerate energy transition.

Held between May and June 2025, this research shows a strong commitment to the energy transition both in Indonesia and in the Asia Pacific region. To open the full potential for Indonesia's energy transition, efforts are needed to maintain the momentum of adoption and investment of renewable energy; sustainable development and digitization of existing systems; development of talents or green workers; as well as closer collaboration between the public and private sectors. If all of this can be achieved, Indonesia's energy transition is on the right track to accelerate in the coming years.

ABB is a technology leader in electrification and automation, contributing to a more sustainable and efficient future in resource utilization. By linking technique and digitization expertise, ABB helps industries operate at high performance, as well as become more efficient, productive, and sustainable so as to exceed challenges.

ABB calls it Engineered to Outrun. The company has a history of more than 140 years with around 110,000 employees worldwide. ABB shares are listed in SIX Swiss Exchange (ABBN) and Nasdaq Stockholm (ABB).

ABB's Process Automation business automates, supplies electricity, and digitizes industrial operations that meet various essential needs, ranging from providing energy, water, and materials, to producing goods and their distribution to the market. With about 20,000 employees, supported by technological and service excellence, ABB Process Automation helps customers in the process, hybrid and maritime industries in improving operational performance and safety, supporting a more sustainable and efficient future in resource use.