Liga Asuransi -Transition towardsrenewable energyNow it is no longer just discourse, but a strategic need for Indonesia to achieve its targets.Net Zero Emission 2060. So far, much of the public’s attention has been focused on solar power plants (PLTS), but there is actually a “sleeping giant” that has not been fully developed:wind energy.
Based on official dataMinistry of Energy and Mineral Resources, Indonesia’s total wind energy potential reaches 154,6 GW, consisting of 60.4 GW of onshore potential(mainland) and94.2 GW offshore potential(offshore). However, until 2024, the installed capacity of PLTB (Wind Power Plants) is only around 152,3 MW, or less than0,1%of existing potential. This figure stands in stark contrast to neighboring countries like Vietnam and Thailand, which have been more aggressive in developing their wind farms.
The Indonesian government is now starting to shift focus with ambitious targets:increase wind power capacity by 5 GW by 2030, as part of the national energy transition roadmap. In the long term, it is projected that PLTB can achieve37 GW installed capacity by 2060, opening up great opportunities for EPC (Engineering Procurement and Construction), developing energy, and investors to enter this sector earlier.
However, developing a wind energy project isn’t as simple as placing a turbine in a windy location. There are real challenges to overcome—fromfluctuating wind characteristics, permits and land, to technical and construction risks, which requires careful planning. This is where the role of project insurance becomes vital, not only as a “contractual condition”, but as a strategic safety net to maintain the continuity of investment and the smooth operation of long-term projects.
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The Huge Potential & Real Challenges of Wind Energy Development in Indonesia
1. Indonesia’s Wind Potential: Large, Widespread, and Strategic
Indonesia has a coastline of more than81.000 kmWith its highly diverse geographical regions—from mountainous areas and coastal areas to remote islands, this situation makes Indonesia one of the countries with the greatest potential.the largest wind energy in Southeast Asia.
According to the Ministry of Energy and Mineral Resources’ wind energy potential map, several areas with ideal wind speeds (>6 m/s) include:
- South Sulawesi(especially Sidrap and Jeneponto) — there are already PLTBs with a total capacity of 152 MW in operation.
- East Nusa Tenggara (NTT)— has a coastal area with stable wind speeds and is suitable for large-scale wind farms.
- East Java & Central Java— has quite large onshore potential in the north and south coast areas.
- Maluku & West Papua— has great potential but infrastructure challenges remain significant.
Besides onshore,offshore wind potentialIndonesia also holds great promise, particularly in the waters south of Java, the Natuna Sea, and eastern Indonesia.floating wind turbines now increasingly mature globally, opening up huge investment opportunities for developers who dare to take the first step.
2. Technical Challenge: Tropical Wind ≠ Subtropical Wind
In contrast to European countries which havestable wind patternIndonesia has a tropical climate with characteristic winds that seasonal and not always constantThis requires meticulous planning of wind power plant capacity. Wind turbines must be selected based on local characteristics, including resistance to high humidity, seawater corrosion, and potential tropical storms.
Besides that, transmission infrastructureIn many high-potential areas, capacity remains limited. Without a robust electricity grid, the power generated by wind farms is difficult to optimally distribute to load centers.
3. Regulations & Licensing Still in Process
Although the government has issued several supporting regulations (such as the 2021–2030 RUPTL and renewable energy tariff policies), the processland and development permitsWind power projects remain a long and complex process. Long-term regulatory certainty, including an attractive feed-in tariff scheme or power purchase agreement (PPA), is a determining factor in the speed of project expansion.
4. Financial & Construction Risks That Require Insurance Protection
The construction of a wind power plant requires significant initial investment—from feasibility studies and land acquisition to turbine installation. Construction risks such as damage due to extreme weather, delay in delivery of turbine components, or damage during installation could cause major losses.
Here it is project insurance (Construction All Risks/Erection All Risks), Marine Cargo for imported components, and Third Party Liability become an important instrument to ensure the project continues to run even if an unexpected incident occurs.
With such enormous potential, the development of wind power plants in Indonesia could be a game-changer in the national energy landscape. However, without proper risk mitigation, this significant opportunity could turn into a significant loss for investors and developers.
Strategic Areas Ready to Become Indonesia’s “Wind Barns”
Energy potentialwind or breezeIndonesia is more than just a theory on paper. In recent years, several regions have demonstrated that these natural resources can be harnessed to generate clean, sustainable electricity. With the support of modern technology and renewable energy policies, the following regions are beginning to be considered prime candidates for Indonesia’s “wind power plant” (PLTB).
1. South Sulawesi – National Wind Farm Pioneer
South Sulawesi is currently becoming icon of Indonesian PLTB development, with two major projects already operational:
- Sidrap Wind Power Plant (75 MW)— Indonesia’s first utility-scale wind project, which began operations in 2018.
- Jeneponto Wind Power Plant (72 MW)— complementing South Sulawesi’s position as a wind energy center in the country.
These two projects capitalize on the relatively stable coastal wind speeds throughout the year, providing concrete examples of how wind farms can be integrated into the national electricity system. This success has led to South Sulawesi being projected as a potential expansion area for larger-capacity wind farm projects in the future.
2. East Nusa Tenggara (NTT) – Stable Winds, Infrastructure Challenges
NTT is known to have strong and consistent seasonal wind patterns, especially in the southern coastal areas such as Sumba, Timor, and Kupang. The average wind speed reaches 6–8 m/s, ideal for large capacity turbines.
The government, along with private developers, has included NTT in the national wind development priority map. However, limitations/electricity network infrastructure and access to project sites remains a major challenge. With investment in grid and logistics transportation, NTT has the potential to become a “golden region” for Indonesia’s wind farms.
3. East Java and Central Java – Wind Potential Near Load Centers
Coastal areasEast Java and Central Java, especially the southern and northern parts, have quite promising wind potential. The main advantages of these two provinces areclose to the national electricity demand center, so that the integration of power from wind farms to the PLN network is easier and more efficient.
Furthermore, the relatively accessible geographical location allows for reduced costs for turbine construction and component delivery. Several feasibility studies have been conducted by national and international developers to identify the most optimal strategic locations.
4. NTB, Maluku, and West Papua – Virgin Winds Awaiting Investors
Eastern regions of Indonesia such as NTB, Maluku and West Papua have characteristic virgin wind— huge but largely untapped potential. Wind speeds in several coastal areas of Maluku and West Papua are high and stable, suitable for development.medium to large scale wind farms.
This region is a medium-term target for investors willing to invest early. With the development of national electricity infrastructure and increased connectivity, these areas could become the new backbone of Indonesia’s wind energy future.
With a combination of pioneer regions such as South Sulawesi, potential regions such as NTT and Java, and frontier regions such as Maluku and West Papua,Indonesia’s wind energy map is now starting to take shapeThe challenge is how to ensure that each region receives support in terms of infrastructure, policies, and risk protection through appropriate project insurance schemes, so that the development of PLTB runs smoothly and sustainably.
Risks and Insurance Needs in Wind Power Projects
Although the potential for wind energy in Indonesia is very large, the development of wind projectsWind Power Plant (PLTB)is not without challenges. In fact, the complex nature of wind power projects—from infrastructure development to the operational phase—brings a number of risks that must be managed seriously. This is where the role of insurance protection becomes crucial, good for developers (developer), EPC contractors, and investors.
1. Construction and Installation Risks
Wind power plant construction involves sophisticated technology and large components such as turbine towers, blades, and high-voltage electrical systems. The transportation and installation of wind turbines often takes place in remote or coastal areas that are difficult to reach.
Common risks at this stage include:
- Damage or loss of equipment during shipping (marine cargo & inland transit).
- Workplace accidents during tower or turbine installation.
- Physical damage due to extreme weather such as wind storms or lightning.
To anticipate this, Construction All Risks (CAR) And Erection All Risks (EAR) become the main foundation of protection during the construction phase.
2. Operational Risk and Business Disruption
Once the turbine starts spinning, the risk shifts to the operational phase. Although the turbine system is designed to be durable,mechanical failure, component failure, or electrical system damage can cause significant downtime.
Besides that, unstable wind intensityIt can also impact energy production projections. If a disruption causes operational shutdowns, financial losses can be significant, especially for investors relying on long-term returns.
For that reason, insurance such asProperty All Risks (PAR), Machinery Breakdown, And Business Interruption becomes very important in maintaining the continuity of the wind project business.
3. Environmental Risks and Third Party Liability
Wind power plant development areas are often located on coastlines, hillsides, or open areas adjacent to residential areas. Construction and operational activities can create potential hazards.legal demands from the surrounding community if it is deemed to cause environmental damage, noise disturbance or other hazards.
Here it isPublic Liability Insurance And Environmental Liability Insuranceplay an important role. Both provide protection against legal risks and compensation for environmental damage or injury to third parties.
4. Financial Risks and Government Policies
Wind power plants are highly dependent on government policies, feed-in tariff schemes, and regulatory support. Uncertainty or sudden policy changes can impact project sustainability, especially for foreign investors.
In addition, many wind power projects use large amounts of funding with complex financial structures. Therefore, instruments such asSurety Bond, Performance Bond, and shape Financial GuaranteeIt is also often necessary to ensure the commitment of all parties and to keep the project cash flow secure.
The Critical Role of Insurance Brokers in Risk Mitigation
In facing various risks, insurance brokers become very important. Brokers are not only tasked with finding the right police, but also:
- Analyze the risk profile of the wind power plant project comprehensively.
- Develop an integrated insurance program that covers the construction to operational phases.
- Bridging negotiations with insurance companies so that large projects such as wind power plants get the best offers with maximum coverage.
- Providing assistance when a claim occurs, ensuring the process runs quickly and transparently.
With a strategic approach, brokers can help developers and investors secure wind energy projects from the potential for large losses that could hinder the sustainability of investments.
This section is an important bridge before we enter into strategic conclusions and recommendations, where the role of the insurance industry will be drawn more broadly into the context of the national energy transition
Conclusion and Recommendations
Energy potentialwindIndonesia is very large and strategic to support the national energy transition towards zero emission 2060. With areas such asSidrap, Jeneponto, NTT, the south coast of Java, to Maluku and Papua which has an ideal average wind speed, Indonesia actually has a “golden map” to make PLTB one of the main pillars of the national energy mix.
However, realizing this potential requires structured steps: from energy spatial planning, investment in efficient turbine technology, strengthening the transmission network, to regulatory certainty and financial support. Cross-sector collaboration—between the government, private developers, financial institutions, and insurance providers—is key to acceleration.
- Prioritize high wind areas such as South Sulawesi and NTT as large-scale PLTB development clusters.
- Promote a hybrid PLTB–PLTS scheme for remote areas to make the energy system more stable and affordable.
- Strengthen risk mitigation aspects through insurance protection and project guarantees, so that investors feel safe and the project can run smoothly.
- Increase local research and human resource training, so that Indonesia will not only become a wind technology market, but also a producer and innovator.
In closing,Wind energy is not just potential—but a real opportunity to build Indonesia’s clean energy future.With careful planning and the right ecosystem support, wind power plants can become one of the backbones of national energy security.
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