Antara News·Indonesia·Tuesday, September 22, 2026 at 11:44 AM

Indonesia offers abundant islands, green power for new data centers

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Putu Indah Savitri, Yashinta Difa

Tangerang, Banten (ANTARA) - Indonesia is pitching its vast archipelago to global tech investors as the ideal home for energy-intensive data centers—promising competitive electricity costs, abundant renewable energy reserves, and tax incentives.

Speaking at the Electricity Connect 2026 conference in Tangerang on Tuesday, Energy and Mineral Resources (ESDM) Minister Bahlil Lahadalia assured prospective investors that Indonesia offers prime geographic and infrastructural advantages for large-scale digital infrastructure.

"Investors need not hesitate to build data centers in Indonesia. Our territory is the largest in Southeast Asia, and we still have an abundance of islands," Bahlil said.

He emphasized that Indonesia possesses extensive clean energy potential—including solar, hydropower, geothermal, and wind resources—capable of supplying the high power demands of data center operations at lower production costs compared to neighboring countries.

Addressing concerns over grid stability and power availability, Bahlil assured investors that state utility firm PT PLN is fully prepared to scale up capacity on demand.

"Once they express their interest and specify the required power capacity, PLN will certainly make the necessary preparations," he stated, adding that the government will also provide a range of facilities and fiscal incentives.

The government has actively promoted data center opportunities, including to Chinese investors during the Indonesia-China Partnership Forum in Jakarta in July.

The push comes as Indonesia’s digital economy accelerates at a record pace.

According to data from the Ministry of Investment and Downstreaming/BKPM, Indonesia's data center market is projected to reach US$1.83 billion in 2026 and grow to US$3.48 billion by 2031—representing a compound annual growth rate (CAGR) of 13.71 percent.

Globally, the market value for data centers is expected to expand from US$386.71 billion in 2025 to US$684.39 billion by 2031.

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