JakartaPost-Aug 13
The government has relaxed its local content requirements for solar power projects financed by foreign investors, as it seeks to expedite renewable energy development in the country and boost the domestic solar panel industry. Rachmat Kaimuddin, undersecretary for transportation and infrastructure at the Office of the Coordinating Maritime Affairs and Investment Minister, said on Aug. 7 that the move would help Indonesia unlock funding from international partners to build its renewable energy supply. Rachmat said the country “cannot wait until the domestic industry is ready”. The policy change, enacted through Energy and Mineral Resources Ministerial Regulation No. 11/2024, came into effect on July 30. Article 17 of the regulation exempts electricity projects from local content rules if at least 50 percent of their funding comes from foreign multilateral or bilateral lenders. Article 19 allows solar power plant projects to use imported panels with the approval of the Office of the Coordinating Maritime Affairs and Investment Minister but also requires project operators to sign a power purchasing agreement before the end of 2024 and have it in operation by the first half of 2026. Moreover, the imported solar panels must be procured from companies that have committed to investing in a production facility in Indonesia. The import window closes on June 30 of next year, “so the imports cannot be [carried out for] long”, Rachmat said Under the previous rules, 60 percent of the components of solar power plants had to be locally made. The government also introduced Industry Ministerial Regulation No. 33/2024, which revokes a 2012 rule requiring the use of domestic products for electricity infrastructure development, except domestic production is not possible, cannot meet the technical requirements or cannot meet demand.
Read more at: https://www.thejakartapost.com/business/2024/08/13/ri-eases-import-rules-for-solar-power-projects.html.
