Indonesia Rooftop Solar Market - Growth, Trends, and Forecast (Outlook to 2028)

The Indonesia rooftop solar market is driven primarily by the new supportive rooftop solar policy (MEMR 26/2021 ), environmental and energy mix targets, increasing residential, commercial and industrial rooftop solar solutions to avoid power outages from the natural disasters, decreasing deforestation, and increasing coal crisis are increasing the demand for Indonesia rooftop solar market.

Indonesia is the world’s largest island country consisting of 17,000 islands situated between the Indian and Pacific oceans and more than half of the population lives on the island of Java, where economic activity is concentrated, while the rest is spread across Sumatra, Bali, Sulawesi, Kalimantan, Nusa Tenggara, Maluku, Papua islands.

A rooftop solar power system or rooftop solar PV system is an electrical installation system that has electricity generated by solar panels mounted on the rooftop or integrated into the façade. The energy generated is used for self consumption, while the rest is supplied to the grid or stored in a battery for lateral use. The rooftop solar systems or rooftop solar PV systems are mainly installed in residential and commercial buildings due to their small size solar systems and low cost source of power generation.

Rooftop solar systems can be installed on any building; the size of the solar installation varies greatly depending on the available space, and the amount the customer intends to spent for installation.

Key Changes Introduced by MEMR for Solar Rooftop:

• The net metering multiplier is finally increased to 100%  from 65%.
• Increasing the accumulation period of net metering credits from 3 to 6 months;
• The MEMR and PLN implemented App"-based reporting system
• Capacity up to 500 kW have to submit a report to the MEMR or governor before the commencement of construction and installations; and to obtain Operation Worthiness Certificate ("SLO").
• Capacity more than 500 kW, Required to hold an Electric Power Provision for Self-Use Business License ("IUPTLS")
• It allows rooftop solar customers to engage in carbon trading schemes,
• The capacity of rooftop systems cannot be limited to the connected power of the customers.
• The Rooftop solar system capacity greater than 3 MW has to integrate the weather forecast data into the database.
• Prohibiting electricity sales directly, the rooftop customer must get a license from the IUPTLU holder to make changes or amendments to the PPA.
• Rooftop solar system, which has been built and installed before this regulation, has to report to the IUPTLU holder and complies with the rules and provisions.

Indonesia Rooftop Solar Market Opportunities:

• Eliminating the net-metering discount for energy exported from rooftop solar PV projects to PLN's grid
• Industries and companies are pressured to adopt more green practices and reduce environmental pollution, they have started relying more on renewable energy sources for their power demand, of which solar energy holds the major share.
• Increasing opportunities to provide electricity to areas in developing countries without proper access to electricity.
• Growing rooftop market in east and west Java, and Jakarta are the provinces having higher market share.

Indonesia Rooftop Solar Market Challenges:

• Integration of over 900 islands into the grid to meet rising energy demand.
• Indonesia has a 65% higher average cost per megawatt of solar PV capacity than India and a 10% higher cost per megawatt than Thailand.

Indonesia Rooftop Solar Market Restraints:

• Lack of the financial mechanism for financing Solar PV rooftop,  such as subsidy, incentives, financing assistance, and soft loan to reduce the high investment cost.
• Prohibiting electricity sales directly by the rooftop customer.

According to Blackridge Research, the outlook for Indonesia Rooftop Solar remains strong in the medium term, and the market is expected to expand during the forecast period due to compelling economics, policies and decarbonization commitments by various stakeholders.

Blackridge Research’s Indonesia Rooftop Solar Market Outlook report consolidates the developments and builds a perspective on growth from the point of view of the solar sector, in its current and future role.

The report provides a comprehensive analysis of the historical development, the current state of solar power installation scenario, and its outlook.

The majority of data in the report have been derived from multiple bottom-up and top-down analyses, as well as proprietary models, databases, and offerings - Solar Intelligence Hub and Global Project Tracker Service built from public and exclusive sources over the years.

The insights include but are not limited to the market data, solar PV installation data and capacity additions data and forecast, government policies and regulations, project data (upcoming solar power projects, under-construction projects, and operating/commissioned solar power plants), company profiles of major players, and competitive landscape analysis.

The market research report covers market dynamics, growth potential of the solar rooftop market, economic trends, and investment & financing scenario in Indonesia.

Further, the report looks at the current state and assesses the potential of residential, and non-residential  solar rooftop deployment.

Special attention is given to depicting the impact of the ongoing COVID-19 pandemic and changes in the government policies and regulatory landscape