Alternative Models for Transmission Financing in Indonesia

This report by the Climate Policy Initiative evaluates five alternative project financing models to help Indonesia's state-owned electricity firm, PLN, meet the USD 24 billion investment requirement for its 2025–2034 transmission expansion goals.

• PLN's Electricity Supply Business Plan (RUPTL) 2025–2034 aims to develop approximately 47.76 thousand circuit kilometers of substations and transmission lines, which will require an estimated total investment of USD 24 billion.
• The report evaluates five project financing models to increase private investment: leasing, joint ventures (JVs), public-private partnerships (PPPs), infrastructure investment trusts (InvITs), and collective investment schemes for infrastructure (CIS-DINFRA). InvITs and CIS-DINFRA are identified as the most liquid and scalable for long-term capital and balance sheet optimization, while leasing and JVs are more practical for near-term, lower-complexity projects. PPPs provide strong risk allocation but rely on government support.
• Successful implementation of these models depends on three policy enablers: a dedicated transmission fee for predictable revenue, off-balance sheet treatment (similar to Independent Power Producers) to protect PLN's financial capacity, and fiscal support like guarantees, subsidies, or availability payments to bridge the gap between regulated tariffs and investor returns.

APA

Climate Policy Initiative (2026). Alternative Models for Transmission Financing in Indonesia. https://www.climatepolicyinitiative.org/publication/alternative-models-for-transmission-financing-in-indonesia/

Chicago

Climate Policy Initiative. Alternative Models for Transmission Financing in Indonesia. 2026. https://www.climatepolicyinitiative.org/publication/alternative-models-for-transmission-financing-in-indonesia/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Alternative Models for Transmission Financing in Indonesia |date=12 May 2026 |url=https://www.climatepolicyinitiative.org/publication/alternative-models-for-transmission-financing-in-indonesia/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2026alternative, author = {{Climate Policy Initiative}}, title = {{Alternative Models for Transmission Financing in Indonesia}}, institution = {Climate Policy Initiative}, year = {2026}, month = may, url = {https://www.climatepolicyinitiative.org/publication/alternative-models-for-transmission-financing-in-indonesia/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }