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Indonesia’s Energy Market Opportunity

March 15, 2011

Ever wondered what an energy sector opportunity looks like?  High installed electricity generation capacity additions in an attempt to address significant net electricity consumption increases in a fast-growing major economy.

Indonesia fits the bill.  Indonesia is ASEAN’s largest economy, growing at 6-7% per annum largely driven by domestic consumption, with increasing social and economic stability, and has a real need for new energy sources.  The government has implemented aggressive policies and regulations to incentivise Independent Power Producers, recognising the need for Foreign Direct Investment to fund much of the new infrastructure.

New additions will be spread across power generation technology classes:  thermal, goethermal, and hydropower.  The country is endowed with generous resources of all three.

Source: EIA (Washington)

 

With a current electrification rate of only about 65%, huge investment in energy infrastructure is required to close the gap.

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