JICA Survey Maps Indonesia’s Hydrogen Value Chain, Identifies Key Commercialization Barriers

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Ecobiz.asia – A comprehensive study by the Japan International Cooperation Agency (JICA) has mapped Indonesia’s potential hydrogen and ammonia value chains while identifying major commercialization barriers that must be addressed before the emerging industry can scale up.

Speaking at the Global Hydrogen Ecosystem Summit (GHES) 2026 on Tuesday (July 21, 2026), JICA Senior Representative Akira Sato said the survey examined technological, infrastructure, regulatory and investment challenges that continue to constrain hydrogen development despite Indonesia’s abundant renewable energy resources.

Conducted jointly with the Indonesian Ministry of Energy and Mineral Resources (MEMR) and other stakeholders between November 2024 and February 2026, the study was designed to help Indonesia transition from hydrogen policy ambitions to practical implementation.

“The survey covered three major areas. We analyzed potential hydrogen and ammonia value chains, identified key bottlenecks to commercialization, and facilitated extensive stakeholder engagement,” Sato said.

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The study involved government ministries, state-owned enterprises, private companies, research institutions and development partners from both Indonesia and Japan. More than 800 stakeholders participated through a series of workshops, forums and study visits, allowing input from industry and policymakers to be incorporated into the final assessment.

According to Sato, the survey identified several hydrogen and ammonia development models suitable for Indonesia, evaluating them not only from technical and commercial perspectives, but also for their contribution to energy security, carbon neutrality and economic development.

The study found that Indonesia possesses significant competitive advantages for hydrogen development, supported by abundant renewable energy resources and multiple potential end-use sectors.

Promising applications include transportation, maritime activities, fertilizer production, industrial processes, power generation and future export opportunities.

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However, the survey also concluded that major commercialization challenges remain. Hydrogen production costs remain high, infrastructure investment requirements are substantial, regulatory frameworks are still evolving, and early-stage market demand remains limited.

“The key conclusion is that hydrogen development is not only a technology issue. It is a market creation issue,” Sato said.

To bridge the gap between hydrogen’s long-term economic benefits and current commercialization costs, JICA examined several policy options, including price-gap support mechanisms, infrastructure investment subsidies, carbon pricing incentives, and standards and certification systems.

“Without targeted incentives, it will be difficult to create sustainable hydrogen demand and attract large-scale investment,” he said.

The survey also developed an Indonesia-Japan hydrogen cooperation roadmap and assessed possible economic incentive schemes to accelerate market formation.

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Looking ahead, JICA is in discussions with MEMR on a new phase of technical cooperation that will shift from policy formulation toward implementation. The collaboration is expected to focus on designing economic incentive mechanisms and supporting early market development.

Rather than pursuing all potential applications simultaneously, priority sectors under discussion include industrial applications, heavy-duty transport, and remote islands, where hydrogen could deliver the greatest decarbonization benefits.

Sato reaffirmed JICA’s commitment to continue working closely with the Indonesian government and international partners to help move hydrogen projects from pilot initiatives to commercial deployment.

“Indonesia has strong hydrogen potential supported by abundant renewable resources and strong stakeholder commitment. The next challenge is creating sustainable markets that enable hydrogen projects to become commercially viable at scale,” he said. ***

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