Ecobiz.asia – Germany’s KfW Development Bank is preparing an energy financing pipeline in Indonesia that could reach €3.04 billion (Rp62.9 trillion) through 2029, covering projects ranging from pumped storage and hydropower rehabilitation to geothermal development, renewable energy and transmission infrastructure.
Diana Arango, Lead Coordinator for the Energy Sector at KfW Development Bank, presented the financing portfolio during Indonesia Sustainable Energy Week (ISEW) 2026 in Jakarta on Wednesday (August 19, 2026).
KfW currently has an energy portfolio worth around €1.6 billion (Rp33.1 trillion) in Indonesia. Its pipeline through 2029 includes new generation projects as well as grid infrastructure and policy programs to support the country’s energy transition.
The planned projects provide a broader picture of where German development financing could be directed in Indonesia over the next several years, including hydropower, geothermal, solar and wind power, as well as electricity transmission.
In the hydropower sector, KfW’s existing portfolio includes projects in Kumbih, Sawangan and Bakaru, as well as the 1,000 Islands Renewable Energy Electrification Programme.
The next phase of financing includes two pumped storage projects and the rehabilitation of 25 hydropower plants. KfW’s presentation did not disclose the capacity, location or individual financing value of the two pumped storage projects.
KfW is also preparing additional financing for geothermal development. Its existing portfolio covers geothermal projects in Kamojang, Ulumbu and Mataloko, while Candi Umbul Telemoyo is included in the future pipeline.
The bank is also planning the second phase of the Accelerating Indonesia’s Clean Energy Transition program, which will support solar and wind power development.
Transmission infrastructure is another major component of KfW’s cooperation with Indonesia. The bank currently supports grid development in Sulawesi and Nusa Tenggara, the Sustainable and Reliable Energy Access Program, and the Green Energy Corridor Sulawesi.
A second phase of the Green Energy Corridor Sulawesi is included in KfW’s pipeline through 2029, underscoring the importance of grid development in integrating renewable energy into Indonesia’s power system.
The financing pipeline also includes policy support. KfW lists the Sustainable and Inclusive Energy Program and the Affordable Sustainable Energy Transition (ASET) program among its ongoing activities, with a second phase of ASET planned.
KfW can provide financial cooperation through several instruments, including policy-based loans to support regulatory reforms, direct investment financing for infrastructure projects, result-based loans linked to agreed outcomes, and grants for project preparation and implementation.
The portfolio reflects the broadening scope of Indonesia-Germany energy cooperation, extending beyond renewable power generation to include grid infrastructure, energy policy and the integration of higher shares of renewable energy into Indonesia’s electricity system. ***
