GREEN INFRASTRUCTURE INVESTMENT OPPORTUNITIES INDONESIA

The report outlines Indonesia's ambition to develop USD 400 billion in infrastructure by 2019, highlighting a significant gap of USD 150 billion to be filled by private and international capital. It showcases a pipeline of 38 green projects for 2018-2019, primarily in renewable energy (geothermal, hydro) and low-carbon transport (rail, BRT). The document emphasizes the success of Indonesia's first sovereign green sukuk (USD 1.25 billion) and the government's policy reforms, such as the creation of PINA and BKPM, to attract sustainable finance. It also details Indonesia's climate goals, including a 29-41% GHG emission reduction by 2030 and a target for renewables to make up 23% of the energy mix by 2025.

• The Indonesian government has set a high priority on infrastructure development, aiming to deliver USD 400 billion in new public-works projects across the energy, transport, water, and waste sectors between 2015 and 2019. The state budget is expected to cover 63% of these costs, leaving an investment gap of approximately USD 150 billion to be filled by capital markets and development partners.
• Indonesia issued the world's first sovereign green sukuk in early 2018. While initial guidance suggested an amount between USD 500 million and USD 1 billion with a 4.05% coupon, the deal was over-subscribed, resulting in a final size of USD 1.25 billion priced at 3.75%.
• A green infrastructure pipeline for 2018-2019 includes 38 projects with costs ranging from a USD 15 million distributed solar project to a USD 6 billion light rail development. The largest shares of these opportunities are in renewable energy (specifically geothermal and hydropower) and low-carbon transport (specifically rail and Bus Rapid Transit).
• Indonesia's National Energy Policy 2014 targets a renewable energy share of at least 23% of the energy mix by 2025 and 31% by 2050, accompanied by reductions in the use of coal, oil, and natural gas for power generation.
• Under its Nationally Determined Contribution (NDC), Indonesia pledged to reduce greenhouse gas emissions by 29% unconditionally by 2030 compared to the Business as Usual scenario, with a potential increase to 41% if international assistance in finance, technology transfer, and capacity building is provided.
• To attract private investment, the government has implemented several reforms, including the creation of the Investment Coordinating Board of Indonesia (BKPM) for simplified licensing and the non-budget financing scheme (PINA). Other measures include removing withholding tax on interest payments for foreign-currency government bonds and providing sovereign guarantees through the Indonesia Infrastructure Guarantee Fund (IIGF).
• The report identifies specific future investment priorities beyond 2019, including the development of net zero carbon buildings, deep retrofitting of existing buildings, and the expansion of solar and wind energy generation, which currently remain largely untapped.
• Indonesia is highly vulnerable to climate change due to its geography, with 42 million people living in areas less than 10 meters above sea level, placing them at risk from rising sea levels and intensifying natural disasters such as floods, tsunamis, and earthquakes.
• The global green bond market grew exponentially to reach USD 160.8 billion in issuance in 2017, an 85% increase from the previous year, driven by strong demand from institutional investors in OECD nations and China.

APA

Climate Bonds Initiative (2018). GREEN INFRASTRUCTURE INVESTMENT OPPORTUNITIES INDONESIA. https://www.climatebonds.net/files/documents/publications/Green-Infrastructure-Investment-Opportunities-Indonesia.pdf

Chicago

Climate Bonds Initiative. GREEN INFRASTRUCTURE INVESTMENT OPPORTUNITIES INDONESIA. 2018. https://www.climatebonds.net/files/documents/publications/Green-Infrastructure-Investment-Opportunities-Indonesia.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=GREEN INFRASTRUCTURE INVESTMENT OPPORTUNITIES INDONESIA |date=May 2018 |url=https://www.climatebonds.net/files/documents/publications/Green-Infrastructure-Investment-Opportunities-Indonesia.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2018green, author = {{Climate Bonds Initiative}}, title = {{GREEN INFRASTRUCTURE INVESTMENT OPPORTUNITIES INDONESIA}}, institution = {Climate Bonds Initiative}, year = {2018}, month = may, url = {https://www.climatebonds.net/files/documents/publications/Green-Infrastructure-Investment-Opportunities-Indonesia.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }