Transitioning to a Green Economy: Legal Frameworks and Challenges in Indonesia’s Renewable Energy Sector

Faculty of Law, Universitas Muhammadiyah Yogyakarta, Bantul, Indonesia

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Abstract

Indonesia, one of the world’s top ten carbon emitters, faces growing urgency to shift from fossil fuels to renewable energy. Despite having over 417.8 GW of renewable potential—including geothermal, solar, wind, and hydropower—only about 10.4 GW (2.5%) has been utilized, with fossil fuels still accounting for 88% of the energy mix. This slow transition is due to overlapping regulations, delays in policy implementation such as the Regional Energy General Plan (REGP)—completed by only 16 of 34 provinces—and the absence of a unified legal framework. This study aims to analyze the legal and policy barriers hindering renewable energy development and assess their implications for Indonesia’s goal of becoming a developed nation by 2030 through a green economy. Using qualitative descriptive legal research, the study applies statutory and conceptual approaches. It examines laws, regulations, and policy documents, supported by academic literature and government reports. The analysis is conducted through qualitative and thematic evaluation. Findings show that regulatory uncertainty and weak intergovernmental coordination obstruct renewable energy progress. A comprehensive Renewable Energy Law is essential to streamline governance, increase investment certainty, and support national targets—particularly achieving a 23% renewable mix by 2025 and reducing emissions in line with global commitments.