Systemiq Ltd. on Thursday unveiled a new roadmap to accelerate Indonesia’s industrial energy transition, proposing Renewable Energy Zones (REZs) as a way to unlock billions in investment and sharply cut emissions across key manufacturing hubs.
Launched in Jakarta, the report—titled “Advancing Indonesia’s Industrial Energy Transition: The Role of Renewable Energy Zones”—was developed in collaboration with the Coordinating Ministry for Economic Affairs of the Republic of Indonesia and supported by ClimateWorks Foundation.
The report outlines how integrated clean energy clusters could bridge the gap between Indonesia’s ambitious renewable targets and its rapidly growing industrial demand.
Indonesia has committed to deploying up to 100 gigawatts of solar capacity while targeting economic growth of around 8%. However, progress has been slowed by fragmented project development, lengthy permitting processes and a persistent mismatch between renewable energy supply and industrial consumption.
The REZ model aims to address these constraints by co-locating renewable generation, transmission infrastructure and industrial users within designated zones—particularly across Special Economic Zones—thereby reducing risk for investors and accelerating project timelines.
“Renewable Energy Zones can connect clean power supply to industrial demand at the scale and speed required,” the report said.
Modelling across eight industrial zones shows REZ deployment could unlock between $13 billion and $18 billion in new capital investment and create up to 100,000 jobs nationwide. The approach could also significantly compress development timelines, which currently average more than four years to reach financial close.
At full technical capacity, the report estimates industrial emissions could be reduced by as much as 80%, positioning REZs as a key lever in Indonesia’s decarbonisation strategy.
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Indonesia’s low-carbon manufacturing competitiveness has lagged in recent years. The report highlights that the country’s revealed comparative advantage (RCA) index remains below 0.2—far below the global benchmark of 1—while renewable deployment per capita stands at just 38 watts, compared with more than 600 watts in China.
By embedding clean energy directly into industrial ecosystems, REZs could help reverse this trend, enabling Indonesia to attract climate-focused investment and strengthen its position in global supply chains increasingly shaped by sustainability standards.
The initiative has drawn support from a wide range of stakeholders, including PT PLN (Persero), the Ministry of Energy and Mineral Resources of Indonesia and the Institute for Development of Economics and Finance, with whom Systemiq signed a memorandum of understanding to deepen collaboration on industrial decarbonisation.
Industry participants such as LONGi Solar and Climate Policy Initiative also attended the launch, underscoring growing alignment between policymakers, investors and industry players on the need for systemic energy transition solutions.
Analysts say the REZ approach reflects a broader shift in policy thinking, where clean energy is increasingly viewed as a cornerstone of industrial strategy rather than a standalone environmental goal.
If successfully implemented, Renewable Energy Zones could offer a replicable model for emerging economies seeking to align economic growth with climate objectives—turning the energy transition into a driver of industrial competitiveness.
