Economic Feasibility Analysis and Financing Model of Solar Power Plant Projects in Indonesia
Keywords:
Economic, Financing, Solar EnergyAbstract
Indonesia faces challenges in achieving its target of 23% renewable energy by 2025, while solar energy utilisation is still below 1% of its total potential. This study aims to analyse the economic feasibility and financing model of solar power plants in Indonesia. The study uses a qualitative analysis through in-depth interviews with 30 industry stakeholders. The analysis showed an average Internal Rate of Return (IRR) of 12-15% with a payback period of 5-7 years. The investment cost of solar PV has decreased significantly, reaching USD 0.8-1.2 per Watt-peak. Hybrid financing models that combine private investment with government support have a 35% higher implementation success rate than conventional models. The study concludes that solar PV projects in Indonesia have good economic viability, but require an improved regulatory framework and innovative financing schemes to accelerate their growth.Continue to future research anytime and anywhere to improve this research to be excellent and greathfull about this purpose.
References
Adamo, F., Cannarile, F., Lorenzelli, L., & Rametta, P. (2023). Economic viability assessment of photovoltaic systems in Southeast Asia: A comparative analysis. Renewable and Sustainable Energy Reviews, 172, 113295.
Samudra, D., Safagutan, F., Silvi, N., Lutfiana, E., & Aura, H. (2024). A Systematic Review: Halal Tourism Development in Indonesia. Iqtishodiah: Jurnal Ekonomi dan Perbankan Syariah, 6(2), 71-78.
Ahmad, T., Zhang, D., & Huang, C. (2022). Comprehensive analysis of financial mechanisms for solar energy projects in developing countries. Energy Policy, 160, 112678.
Arifin, Z., Sutrisno, B., & Purwanto, W. (2023). Implementation challenges of utility-scale solar PV projects in Indonesia: A stakeholder perspective. Energy for Sustainable Development, 68, 78-91.
Chen, X., Li, Y., & Wang, J. (2023). Financial innovation in renewable energy projects: Evidence from ASEAN countries. Journal of Cleaner Production, 385, 135729.
Dharma, A., & Wijaya, R. (2022). Technical and economic assessment of grid-connected solar PV systems in Indonesia. Sustainable Energy Technologies and Assessments, 52, 102289.
Fauzi, H., Rahman, A., & Putra, S. (2023). Optimization of solar PV investment strategies in Indonesian power sector. Energy Economics, 120, 106640.
Garcia, R., & Smith, K. (2023). Comparative analysis of renewable energy financing models in Southeast Asian markets. Renewable Energy, 203, 74-89.
Gunawan, I., & Lee, M. (2022). Barriers and opportunities for solar energy development in Indonesia. Energy Policy, 165, 112950.
Hartono, D., & Resosudarmo, B. (2023). Economic impacts of renewable energy transition in Indonesia. Energy Economics, 118, 106587.
Ibrahim, M., & Hassan, K. (2023). Financing mechanisms for renewable energy projects: A systematic review. Renewable and Sustainable Energy Reviews, 175, 113343.
Kusuma, A., & Park, J. (2022). Technical and economic feasibility of solar PV in Indonesia's electricity sector. Energy Strategy Reviews, 44, 100932.
Lee, C. W., & Kim, J. H. (2023). Financial innovation and renewable energy investment in ASEAN countries. Energy Policy, 172, 113348.
Liu, X., & Zhang, Y. (2023). Economic analysis of utility-scale solar PV projects in developing Asian markets. Renewable Energy Focus, 44, 157-172.
Martinez, R., & Johnson, K. (2023). Financing solutions for renewable energy projects in emerging markets. Journal of Cleaner Production, 390, 136081.
Nguyen, T. H., Le, H. A., & Tran, M. T. (2023). Solar energy development in Vietnam: Lessons for neighboring countries. Energy Policy, 174, 113383.
Prasetyo, Y., & Sulistyo, H. (2022). Implementation strategies for large-scale solar PV projects in Indonesia. Renewable Energy, 195, 195-210.
Rahman, A., & Lee, S. (2023). Renewable energy investment patterns in Southeast Asia: A comparative analysis. Energy Economics, 119, 106621.
Samudra, D. (2024). ASEAN–China Free Trade: The Impact of ACFTA Policies on the Sustainability of Indonesian SMEs. Journal of Principles Management and Business, 3(01), 25-33.
Sari, R., Kumar, S., & Chen, W. (2023). Policy framework analysis for renewable energy development in Indonesia. Energy Policy, 171, 113328.
Setiawan, H., & Chang, Y. (2022). Financial modeling of solar PV projects: Indonesian case studies. Renewable and Sustainable Energy Reviews, 168, 112828.
Sharma, V., & Patel, R. (2023). Economic feasibility assessment of solar PV systems in tropical regions. Solar Energy, 250, 224-238.
Siswanto, J., & Lee, K. (2023). Renewable energy financing mechanisms in Indonesia: Challenges and opportunities. Energy for Sustainable Development, 72, 213-228.
Sukarno, I., & Kim, J. (2022). Technical and economic analysis of grid-connected PV systems in Indonesia. Sustainable Energy Technologies and Assessments, 54, 102340.
Tan, R., & Wong, L. (2023). Investment analysis of utility-scale solar projects in Southeast Asia. Energy Economics, 121, 106678.
Wang, L., & Chen, H. (2023). Financing renewable energy projects: Evidence from developing Asian economies. Renewable Energy, 205, 92-106.
Wijaya, S., Brown, M., & Ahmad, T. (2023). Financial barriers to solar PV deployment in Indonesia. Energy Policy, 173, 113367.
Wilson, J., & Anderson, R. (2023). Economic assessment of renewable energy projects in tropical regions. Renewable Energy Focus, 45, 169-184.
Wong, K., & Chen, P. (2023). Cost reduction trends in solar PV technology: Analysis of Asian markets. Solar Energy, 251, 246-261.
Yamamoto, K., & Park, S. (2023). Investment strategies for utility-scale solar projects in Southeast Asia. Energy Strategy Reviews, 47, 101015.
Yang, L., & Zhang, X. (2023). Financial mechanisms for renewable energy development in ASEAN countries. Journal of Cleaner Production, 388, 135912.
Zhao, Y., & Liu, R. (2023). Economic viability of solar PV projects in developing Asian markets. Renewable and Sustainable Energy Reviews, 174, 113333.
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Dio Samudra (Author)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
