Is Feed-In-Tariff Policy Effective for Increasing Deployment of Renewable Energy in Indonesia?

Abstract

Abstract To achieve the targeted portion of renewable energy and to attract more investment in renewable electricity Indonesia’s government has issued several feed-in-tariff regulation, which is policy instrument successfully applied in many countries. This study is an exploratory research to evaluate how the policy works in Indonesia, especially in the field. The study shows that while the policy triggers investment interests, many obstacles are encountered due to imperfections in the feed-in-tariff policy package, and other non-cost factors. Several unanticipated side effects were also identified as consequences of the upturn in investment interest, indicating that transition to cleaner energy is much more challenging for developing countries such as Indonesia.