Rethinking geothermal energy: Between climate solution and socio-environmental risk

The report examines the impact of geothermal energy development in Indonesia, highlighting a contradiction between its role as a climate solution and the resulting socio-environmental risks. It details how funding from the World Bank and Asian Development Bank (ADB) has accelerated projects that lead to water depletion, pollution, and the displacement of local livelihoods. The document documents specific cases of environmental degradation, such as mudflows and gas leaks, as well as the criminalization of dissent and the marginalization of women and Indigenous peoples. It concludes that the current financial model transfers risk to local communities and calls for a transition based on equity, justice, and the explicit consent of affected populations.

• International financial institutions (IFIs) have significantly accelerated geothermal development in Indonesia through large-scale loans and risk mitigation. The World Bank's Geothermal Resource Risk Mitigation Project (GRRMP) involved a $325m loan, $127.5m in grants from the Clean Technology Fund (CTF), and $150m from the Indonesian government to attract private investment. The Asian Development Bank (ADB) provided a $300m loan in 2020 to PT Geo Dipa Energi (GDE) for capacity expansion in Java, followed by a $180m loan in 2025 for two 55MW plants, and a $92.6m agreement with Supreme Energy Muara Laboh (SEML) for a facility in West Sumatra.
• Geothermal operations cause severe water depletion and contamination. Producing one megawatt of power can use between 6,500 and 15,000 litres of water. At the Ijen plant in East Java, daily use of 6.5 million litres has depleted local sources, leaving over 200 households with cloudy and bitter spring water. In Dieng, Central Java, fracking for Enhanced Geothermal Systems (EGS) has introduced arsenic and boron into streams. Other contamination includes the Prukut River at Mount Slamet and Lake Linow in North Sulawesi, where the disappearance of bio-indicator insects (sayok and komo) evidenced water quality decline.
• Drilling accidents and gas leaks have caused fatalities and land damage. In Mataloko, East Nusa Tenggara, blowouts of 15 to 30 metres occurred in 1998, causing ongoing mudflows. A fatal incident occurred in 2022 at Sorik Marapi, North Sumatra, where hydrogen sulfide (H₂S) gas and blowouts reached 30 metres. Since 2021, H₂S leaks at Sorik Marapi have caused five women to die in January 2021 and affected over 150 residents across multiple poisoning incidents in 2022, with further harm reported in 2024 and 2025.
• Geothermal expansion leads to significant economic losses for agricultural communities and exacerbates gender inequality. In Wae Sano, Sakoria, and Ulumbu (East Nusa Tenggara), farmer income is projected to drop by IDR 470bn (approx. $27.56m), with total economic losses estimated at IDR 1.1tn (approx. $64.5m) in the first two years. The shift of water and labor to construction reduces food crop productivity. Women are disproportionately affected as they must travel further for water and food, often forcing them to become migrant workers due to destroyed local livelihoods.
• Projects threaten Indigenous cultural heritage and are often implemented through the violation of Free, Prior, and Informed Consent (FPIC). In Atadei, East Nusa Tenggara, odors from wells disrupt the Tun Kwar ritual. In Lampung, World Bank-backed exploration on Mount Rajabasa threatens the ancestral shelter of the Saibatin Paksipak Sekala Brak Customary Kingdom. In Poco Leok, Flores, the Ulumbu plant expansion risks desecrating ancestral graves and sacred springs. Environmental Impact Assessments are often provided only in English, hindering informed community decision-making.
• Resistance to geothermal projects is met with criminalization and state violence. Indonesian Law No. 21 of 2014 allows for up to seven years in prison and fines of IDR 70bn for obstructing exploration. In Mount Gede, community members from 15 villages facing legal charges for opposing a project that affects four major watersheds (Citarum, Cimandiri, Cisadane, and Ciliwung). In Poco Leok, the arrival of the state electricity team (PLN) was escorted by armed police and soldiers, leading to brutal clashes and arbitrary arrests.

APA

Triasdian, B. (2026). Rethinking geothermal energy: Between climate solution and socio-environmental risk. Trend Asia. https://trendasia.org/wp-content/uploads/2026/06/Geothermal_Indonesia_Banking-on-Renewables_April-2026.pdf

Chicago

Triasdian, Beyrra. Rethinking geothermal energy: Between climate solution and socio-environmental risk. Trend Asia, 2026. https://trendasia.org/wp-content/uploads/2026/06/Geothermal_Indonesia_Banking-on-Renewables_April-2026.pdf.

Wikipedia

{{cite report |last1=Triasdian |first1=Beyrra |title=Rethinking geothermal energy: Between climate solution and socio-environmental risk |publisher=Trend Asia |date=April 2026 |url=https://trendasia.org/wp-content/uploads/2026/06/Geothermal_Indonesia_Banking-on-Renewables_April-2026.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{triasdian2026rethinking, author = {Triasdian, Beyrra}, title = {{Rethinking geothermal energy: Between climate solution and socio-environmental risk}}, institution = {Trend Asia}, year = {2026}, month = apr, url = {https://trendasia.org/wp-content/uploads/2026/06/Geothermal_Indonesia_Banking-on-Renewables_April-2026.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }