Masdar makes strategic investment in major geothermal player

28 February 2023

Masdar is making a strategic investment in Indonesian company Pertamina Geothermal Energy, (PGE) one of the world's largest geothermal players. The investment (the total consideration has not been disclosed) marks Masdar's entry into geothermal energy, in the second-largest geothermal market in the world.

Dr Sultan Al Jaber, UAE minister of Industry and Advanced Technology, and chairman of Masdar, commented” "Achieving the 1.5C target set out in the Paris Accords will require humanity to leverage all sources of low-carbon energy, including sources that are currently under-utilised, like geothermal. Through its investment in PGE, Masdar is demonstrating its continuing commitment to Indonesia's energy transition and its support of one of the major focus areas of the upcoming COP28, which is to provide practical energy security solutions while reducing emissions."

Ahmad Yuniarto, CEO of PGE, said: "We endeavour to develop 600 MW in additional installed capacity over the next five years to support Indonesia's renewable energy mix."

Indonesia has a goal of increasing its installed geothermal capacity from 2.8 GW in 2022 to 6.2 GW by 2030. The government is targeting net-zero emissions by 2060 and having renewables provide 23 % of the energy mix by 2023. PGE has been operating geothermal facilities in Indonesia for the last 40 years, with a portfolio capacity exceeding 1.87 GW.

The PGE investment is the latest in Masdar's continuing effort to expand and increase its strategic partnerships in the Asia-Pacific region. It is already developing the region's largest floating solar facility – the 145-MW Cirata floating solar PV Plant in Indonesia – and last year signed an agreement with Tuas Power, EDF Renewables, and PT Indonesia Power to explore development of up to 1.2 GW solar capacity in Indonesia for export to Singapore.

Image: A geothermal energy plant in Indonesia

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