What You Need To Know About Indonesia’s Energy Storage System

Indonesia is planning to develop a vast energy storage system to minimize the carbon pollution and supporting the renewable energy program

Indonesia has recently launched a 5 megawatt Battery Energy Storage System (BESS). The new energy storage system is a device that enables energy from renewables to be stored and then released based on the needs of the customer.

The Battery Energy Storage System is a pilot project and is a concrete example of the government’s attempt to shift away from diesel-generated power and transition to cleaner energy. State Electricity Company (PLN) reveals that they have signed a Memorandum of Understanding.

Batteries are required to provide constant electricity supply to renewable energy plants, which are primarily intermittent, such as solar and wind power plants. The agreement was made with other state-owned bodies, such as the Indonesian Battery Corporation, to build the Battery Energy Storage System by 2022. However, no information has yet been revealed about the Battery Energy Storage System’s location or specific functions.

Aside from this, PLN also plans to convert 250 MW diesel-fired power plants to renewable energy by this year. This is because electric supply within the community is still required. To support the initiative, a Battery Energy Storage System is needed to support the initiative and become an integral part of the plan.

The Battery Energy Storage System will also be applied to all power plants under the PLN group. Subsidiaries of PLN involved in the Battery Energy Storage System project happen to be the primary electricity providers in Indonesia, such as PT Indonesia Power, PT Pembangkitan Jawa Bali, and others.

The Economic Benefits of the Energy Storage System Plan

The Energy Storage System Grand Plan

The plan to develop an energy storage system aligns with the positive growth in the renewable energy industry. This growth is also visible in countries like Indonesia, where the Central Government has set an optimistic target of 23% usage of renewable energy by 2025.

An independent organization called Agensi International Energi Terbarukan (IRENA) has predicted that Indonesia will be able to reach up to 31% of renewable energy usage by the year 2040.

Nicke Widyawati, the General Director of PT Pertamina Persero, shares that Indonesia has a vast BESS market. She further identifies that two primary industries have great potential in utilizing lithium batteries. The first one is BESS and the second one is transportation.

The Deputy for the Coordinating Ministry of Maritime Affairs and Investment, Septian Hario Seto, elucidates that BESS business is in line with the usage of photovoltaic solar that has been launched by the government and is to be utilized in remote areas. These areas do not require electricity transmission on a large scale. Therefore the BESS is considered sufficient to support the electricity needs.

The Tesla Deal

The Indonesian government has worked tirelessly to pull foreign investors to invest in Indonesia. Tesla has shown great interest in pouring funds into the country. There have been talks with Tesla, with plans to invest in Indonesia’s Battery Energy Storage System sector.

Tesla has an outstanding reputation in its production of technology that is carbon neutral. The BESS produced and used by Tesla has a relatively low negative environmental impact. Another interesting point is that the BESS can be built under various geographical conditions.

The meeting was held with Elon Musk as the CEO of Tesla, Luhut Binsar Pandjaitan as the Minister of Maritime Affairs and Investment, and Anindya Bakri, a conglomerate with a specific interest in the mining sector.

The Potential of The Energy System Storage

2021 was an important year for Indonesia as the government has issued necessary regulations to facilitate renewable energy growth and reach the ambitious goal of 2025. The Memorandum of Understanding is continuously being drawn up through the various construction projects planned and started.

The negotiations to support the initiative are also done with large foreign firms, all done to boost Indonesia’s renewable energy industry to show that this industry will only prosper. The Indonesian government is also assisting this sector by providing low-interest financing to bolster the installation and development of renewable energy.

PLN has and will continue to construct various breakthroughs for Indonesia’s renewable energy sector. They have been successful in doing so despite the COVID-19 pandemic, which had a massive impact on the nation. However, the government needs to ensure that the energy transition is done optimally so that there is no energy supply shortage due to their attempts to repair the environment.

The efforts shown have been immense and have positively motivated the transition to renewable energy. In this regard, Cekindo assists with matters related to business licensing and company registration should there be a desire to exploit the current benefits provided to business actors operating in the renewable energy sector.

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FAQs

Before you can distribute your products in Indonesia, you will have to register your product with the BPOM (National Agency of Food and Drugs) and MoH (Ministry of Health). Only an Indonesian legal entity can register the product. If you decide to distribute your product via a local distributor, they will register the product under their entity in Indonesia and become the product license holder. Cekindo can act as your local distributor and register the product under its name.

Yes, you can import your product through importer of record services which enables companies to import products into a country through an import partner.

In general, the registration will take between 3 to 6 months. However, it all depends on the classification of your medical device. Class 1A, it may take 3 - 4 months, class 2B and 2C may take 4-5 months and class 3D may take up to 6 months

Currently, Indonesia holds a four-grade risk evaluation system as follows:

  • Category A (low risk) - if mishandled or not used properly, medical device is not harmful to humans.
  • Category B (low to moderate risk) - if mishandled or not used properly, medical device can have some serious effects but will not be considered as a serious accident to humans.
  • Category C (moderate to high risk) - if mishandled or not used properly, medical device can have very serious effects but will not be considered as a serious accident to humans.
  • Category D (high risk) - if mishandled or not used properly, medical device can have some serious effects and will be considered as a serious accident to humans.

The registration process may take between 4 to 8 months. However, the process is affected by many factors

In short, the steps are as follows:

  1. Building Inspection (Pemeriksaan Sarana Bangunan/PSB): every office and every warehouse of the company that will go through the product registration process will be audited by BPOM.
  2. Legal Entity Registration.
  3. Manufacturing Registration.
  4. Product Registration.

In general, cosmetic registration in Indonesia takes up to 3 months. However, it can be affected by many factors

Every importer must maintain product information files including information regarding import and distribution. The company should prepare the Product Information File (PIF), which will be audited by BPOM 6 months since registration approval.

In general the registration process takes between 3 to 6 months in Indonesia.

It will be valid for 5 years, depending on the Authorization Letter of Product Owner.

How an application is handled is based on a "first-come-first-served" basis. If you delay your trademark registration, somebody else may have registered your trademark first. You will then lose your unique trademark.

Yes. Accurate translation is necessary. Registration documents contain important details. Therefore, you need a certified translator to help you do a proper translation.

You can transfer the license as long as your current local distributor agrees to change the product license holder. The procedure will be different for each product category. We can only recommend you try to prevent these issues by setting cooperation with a trustworthy partner from the beginning

Not completely. You can leverage a service called Importer of Record or Undername Importer to assist you in importing products into Indonesia.

There are plenty of products, but the most common products include food, beverages, traditional medicines, health supplements, cosmetics, chemical products, genetically engineered products, medical devices and household appliances.

In general, a halal certificate is valid for two years and it must be extended at least three months before it becomes expired.

Companies that:

  • Need swift access into the Indonesian market
  • Have local distributors and retail partners in Indonesia
  • Import goods seasonally
  • Import multiple products from a range of categories
  • are not eligible to apply for an import license

To protect a consumer's safety, Indonesia requires most imported products to be SNI-certified. These products include food & beverages, bicycles, children's toys, air conditioners, and fans, and many other consumer goods.

It is important to note that the government sometimes updates the list of products that require SNI certification, so it is recommended to contact Cekindo to ensure whether your products are the subject of SNI certification.

Health supplement/traditional medicine registration will take 6 - 12 months. However, the process is affected by many factors.

It will be valid up to 5 years, depending on the Letter of Authorization from the Principle (product owner).

Post Verificator

Verified by:​

Pandu Biasramadhan

Pandu is the Consulting Manager at Cekindo. He has extensive experience in working with government agencies. Notably, he has provided market-entry solutions for enterprises in Indonesia and managed regional partnership channels in Southeast Asia. At Cekindo, Pandu aspires to lead the consulting team to provide top-quality market-entry services and maintain a portfolio of global clientele. His specialty is market-entry advisory and business process outsourcing.