Taiwan-Indonesia form environmental alliance
Indonesia and Taiwan are moving forward with a strategic partnership aimed at advancing renewable energy development in both countries. This partnership leverages Taiwan's technological capabilities and financial resources with Indonesia's abundant natural resources and renewable energy ambition.
Floating Solar Megawatt Corridors
A joint pilot project of 500MW, starting with the Cirata Reservoir in West Java, is under consideration. This project aims to harness Indonesia's water-based solar potential with Taiwanese engineering and financing. While specific progress on the pilot project isn't detailed yet, the proposal highlights the potential for collaboration, combining Indonesia's geographical advantages with Taiwan's technological expertise.
Offshore Wind Supply-Chain Cooperation
Taiwanese firms are suggesting the establishment of assembly and component yards in locations such as Batam or Sulawesi. This cooperation would support both Taiwan's Changhua wind projects and Indonesia's emerging coastal wind zones, reducing logistics costs and streamlining subsea cable deployment. This proposal is part of a broader energy compact aimed at fostering cross-border manufacturing and supply-chain efficiency.
Knowledge Exchange and Financing
Taiwanese insurers and pension funds are proposed to help bridge Indonesia's clean-energy financing gap through blended-finance models tied to the Just Energy Transition Partnership (JETP). The idea is to mobilize stalled investments by offering equity or credit for floating PV and wind projects, potentially through a Jakarta-based clean-energy fund backed by Taipei investors. This initiative is critical for unlocking stalled projects and supporting Indonesia's renewable ambitions.
The Future of the Partnership
These proposals reflect a strategic partnership that could significantly advance both countries' renewable energy goals. However, specific implementation and progress details might still be in development.
In a significant move, Taiwan's Cathay Life Insurance acquired a 50% stake in Orsted's 583MW Greater Changhua 4 offshore wind farm for US$1.64 billion, signaling a shift toward Taiwanese financial institutions owning climate infrastructure.
As of the end of 2023, renewables made up only 13% of on-grid electricity generation in Indonesia, falling short of its 23% target for this year. The synergy between Taiwan and Indonesia could help Indonesia reach its renewable energy targets and expand Taiwan's green industrial footprint in Southeast Asia.
[1] Source: Various news reports and press releases from both Indonesian and Taiwanese government and private sector entities.
- The floating solar megawatt corridors project, considering a 500MW partnership between Indonesia and Taiwan, seeks to utilize Indonesia's water-based solar potential with Taiwanese engineering and financing.
- The collaboration between Taiwanese firms and Indonesia aims to build assembly and component yards in Batam or Sulawesi, promoting cross-border manufacturing for offshore wind projects.
- To address Indonesia's clean-energy financing gap, Taiwanese insurers and pension funds are proposing a blended-finance model using stalled investments in floating PV and wind projects.
- The synergy between Taiwan and Indonesia could markedly propel the renewable energy goals of both countries, helping Indonesia reach its 23% target and increasing Taiwan's green industrial presence in Southeast Asia.
- As a precursor to future developments, Taiwan's Cathay Life Insurance invested in Orsted's offshore wind farm, demonstrating a shift toward Taiwanese financial institutions owning climate infrastructure.
- Progress and details on the implementation of this strategic partnership are still being developed, although the potential for environmental-science, technology, and business growth is clear, especially in the areas of education-and-self-development and personal-growth for both countries.
