Indonesia Renewable Energy Certificate Market - 2025-2032

Indonesia Renewable Energy Certificate Market reached US$ 9.28 million in 2024 and is expected to reach US$ 14.31 million by 2032, growing with a CAGR of 4.9% during the forecast period 2025-2032.

Indonesia holds a significant share in the renewable energy certificate (REC) market due to its abundant renewable energy resources, growing energy demand and supportive government policies. The country has vast potential in geothermal, solar, wind and hydropower, making it a key player in the region's renewable energy transition.

Indonesia has pledged to reduce carbon emissions by 29% from business-as-usual levels by 2030 as part of its commitment to the Paris Agreement. This goal aligns with the country's broader efforts to accelerate renewable energy adoption, enhance sustainability and transition towards a low-carbon economy and driving the REC market.

Market Dynamics

Increasing Corporate Demand for Clean Energy

One of the key drivers of Indonesia's Renewable Energy Certificate (REC) market is the increasing corporate demand for clean energy to meet sustainability commitments and net-zero targets. Multinational corporations (MNCs) and domestic businesses are increasingly aligning with global initiatives like RE100, Science-Based Targets (SBTi), and ESG (Environmental, Social, and Governance) compliance, which require them to source a significant portion of their electricity from renewable sources.

For example, in 2023, Google Indonesia partnered with PLN (Perusahaan Listrik Negara) to purchase RECs as part of its commitment to 100% renewable energy by 2030. This trend is also seen among manufacturing giants and data center operators like Amazon Web Services (AWS) and Microsoft, which are expanding their footprint in Indonesia while adhering to global sustainability goals. As more corporations commit to carbon neutrality and scope 2 emissions reductions, the demand for high-quality, certified RECs from sources such as solar and geothermal is expected to rise, further driving the growth of Indonesia's REC market.

Limited Availability

One of the major restraints in Indonesia's Renewable Energy Certificate (REC) market is the limited availability of certified renewable energy sources. While Indonesia has significant renewable energy potential, including geothermal, solar, and hydropower, the country's energy mix remains dominated by coal, which accounts for over 60% of total electricity generation. The slow pace of renewable energy project development, coupled with regulatory hurdles and insufficient grid infrastructure to support large-scale renewable integration, restricts the availability of RECs.

For example, PLN's Green Energy Certificate (REC) program has seen rising demand from corporations, but the supply of RECs remains constrained due to delays in renewable energy project approvals and the lack of standardized verification mechanisms. This mismatch between supply and demand results in higher REC prices, making it less attractive for small and medium-sized enterprises (SMEs) and local businesses to participate.

Segment Analysis

The Indonesia renewable energy certificate market is segmented based on type and energy source.

I-RECs are Expected to Drive the Segment Growth.

The I-REC Standard provides a robust framework for issuing, trading and redeeming renewable energy certificates internationally. In the Asia-Pacific, this system has gained traction as countries seek to meet their renewable energy targets and corporations aim to fulfill sustainability commitments. Multinational corporations (MNCs) operating in Indonesia, particularly in sectors like manufacturing, technology, and retail, are actively seeking renewable energy solutions to align with their ESG (Environmental, Social, and Governance) targets.

Many companies, including those under the RE100 initiative, require credible and verifiable renewable energy procurement options, making I-RECs an attractive solution. For example, Unilever Indonesia has committed to sourcing 100% renewable electricity for its operations. To achieve this, the company has started purchasing I-RECs to offset its carbon footprint and meet its sustainability targets.

Pricing Analysis

The pricing of International Renewable Energy Certificates (I-RECs) in Indonesia is influenced by factors such as renewable energy supply availability, corporate demand, government policies, and global REC price trends. Compared to other APAC markets, Indonesia's I-REC prices remain relatively competitive but are gradually increasing due to higher corporate sustainability commitments and growing demand from multinational companies looking to decarbonize their operations.

The cost of an I-REC in Indonesia varies depending on the source of renewable energy (solar, wind, hydro, or biomass) and the volume of purchases. As of recent trends, I-REC prices in Indonesia solar RECs typically range between US$ 3.12 per MWh in 2023 to US$ 4.45 per MWh in 2025, with premium pricing for certificates linked to new renewable energy projects or those with additionality claims.

Competitive Landscape

The major global players in the market include Perusahaan Listrik Negara (PLN), Medco Power Indonesia, Pertamina NRE, I-REC Standard, Adaro Energy and Barito Pacific Energy.

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Target Audience 2024

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