Pertamina Geothermal Energy: 18 Years of Pioneering Indonesia's Green Energy Transition

PT Pertamina Geothermal Energy Tbk (PGE), a subsidiary of PT Pertamina (Persero), has been at the forefront of Indonesia's geothermal energy development for 18 years. Established to harness the nation's vast geothermal potential, PGE has significantly contributed to Indonesia's renewable energy landscape and its commitment to achieving Net Zero Emissions (NZE) by 2060.

Expanding Geothermal Capacity

Indonesia boasts a geothermal potential of approximately 24 GW, accounting for 17% of the world's reserves and ranking second globally after the United States. PGE has been instrumental in tapping into this resource, operating several geothermal plants across the country. As of 2024, PGE has achieved a notable increase in its own production, reaching 3,597.16 GWh, a 0.31% rise from the previous year's 3,585.96 GWh. This growth has bolstered the company's operating revenues to USD 293.21 million, marking a 0.2% increase from USD 292.63 million in the prior year.

To further enhance its capacity, PGE is accelerating the development of three strategic projects:

• Hululais Units 1 and 2: Expected to contribute an additional 110 MW.
• Lumut Balai Unit 2: Aiming to add 55 MW to the company's installed capacity, with mechanical completion targeted by the end of 2024.
• Co-generation Project: Projected to increase capacity by 45 MW, with commercial operations anticipated by 2027.

These initiatives align with Indonesia's national energy mix target for 2033, which requires an additional installed capacity of 4.4 GW, potentially attracting investments between USD 27 to 28 billion.

Economic Impact and Job Creation

Investments in geothermal energy have a multiplier effect on Indonesia's economy. For every USD 1 invested in the green energy sector, there is an estimated increase of USD 1.25 in Gross Domestic Product (GDP). Moreover, it is projected that each USD 1 million investment in the geothermal sector can create 70 to 100 jobs, underscoring the industry's role in economic development and employment generation.

Financial Performance and Sustainability Commitments

In the third quarter of 2024, PGE reported a net profit increase of 0.36% year-on-year, totaling USD 133.99 million. This achievement is attributed to solid production optimization and accelerated maintenance programs. Despite a slight 0.71% year-on-year decline in revenue to USD 306.02 million, primarily due to carry-over effects from 2023 and reclassification of carbon credit revenues, PGE has maintained superior performance through operational efficiency and strategic development initiatives.

PGE's commitment to Environmental, Social, and Governance (ESG) principles is evident in its negligible risk score of 7.1 from Sustainalytics, positioning it as a leader in the renewable energy sub-sector. The company has also received multiple accolades, including the Platinum Award at the Global CSR & ESG Summit and the Patra Adikriya Bhumi Utama Awards 2023 for its Health, Safety, Security, and Environment (HSSE) implementation.Future Outlook

Looking ahead, PGE aims to increase its installed capacity by 1 GW within the next 2-3 years and to 1.5 GW by 2035. The company is exploring both organic growth through strategic projects and opportunistic inorganic growth via potential acquisitions. By focusing on high-quality geothermal resources and technological advancements, PGE is poised to play a pivotal role in Indonesia's energy transition, reinforcing the nation's energy security and contributing to global sustainability efforts.