Ecobiz.asia – Waste-to-energy (WtE) plant recently gained attention with the new presidential regulation 109/2025 and sold as a working solution for overflowing Indonesia’s landfills. However, high moisture waste, lack of community trust, and weak incentives keep stalling projects.
Most Indonesia’s city waste is organic and wet, collection is inconsistent, segregation is weak, and trust in big facilities is fragile after years of smoke, complaints, and stalled projects. A model built for dry, well sorted waste and tight enforcement struggles in a system where trucks arrive loaded with whatever households and informal pickers leave behind.
There is another way to design these plants. Instead of forcing everything through a single combustion line, newer platforms split wet and dry streams, turn them into different products, and link payments to what the operator actually delivers over time. In a recent conversation, Lady Jennifer Wentzki, Managing Director of BlueGas Technologies, argued that this is not a technology gap but a system design problem.
Why mass-burn does not fit Indonesia today
On paper, mass-burn incinerators fit neatly with Indonesia’s current presidential regulation, which still frames waste to energy success in terms of megawatts installed and kWh delivered. In reality, most Indonesian cities collect waste that is too wet, too organic, and too mixed for that model to work. Plants sized and financed as mini power stations end up fighting their own feedstock while dumps and open burning continue in the background. As Lady Jennifer notes, “Limited segregation at source mixes plastics, recyclables, and hazardous materials, raising emissions risks.”
This pattern is exactly what Indonesia environmental groups have been warning about. Wahana Lingkungan Hidup Indonesia (WALHI), which has tracked a series of PLTSa cases across Indonesia’s major cities (Jakarta, Surakarta, Bandung), notes that organic waste is consistently the dominant fraction, the waste is wet and mixed, and thermal plants struggle to operate as promised.
In WALHI’s 2024 report titled Sowing the Seeds of Destruction, it was concluded, “all cases have organic waste composition as the most dominant waste. Carrying out the thermal process will be difficult because the condition of the waste is inadequate to be the capital of the PLTSa. This is coupled with the assumption that the waste that enters is mixed so that the potential for danger (explosion and poison) becomes high and the loss of potential benefits from materials with utility value such as recycled materials.”
Beyond practical issues, incineration forces a complex, messy, high-moisture waste stream through a single combustion line to make a single product. That made sense in systems with dry, well sorted waste and strong enforcement. In Indonesia today, it looks increasingly misaligned with the physical reality of the waste stream, the politics of local communities, and the need for flexible outputs that can evolve with the energy transition.
The two-stream, multi-output BlueGas model
Instead of forcing everything into one combustion line, the alternative starts by admitting a simple fact that wet and dry waste behave differently and deserve different treatment. The whole plant is designed around that split.
At the front end, trucks still arrive mixed. The difference is what happens next. Waste is mechanically and manually sorted so that wet, organic-rich material is pulled into one stream, and drier, higher calorific material into another. Each stream then follows its own path and produces its own products.
Local bioprocess experts have been pointing to the same design need. Professor Wiratni from Universitas Gadjah Mada warns that trying to process mixed organic and inorganic waste will always be costly and unpopular: “If the waste remains mixed between organic and inorganic materials, the process will incur losses, and the investment could be wasted. A PLTSa can indeed be equipped with a drying system, but that would raise operational costs and cause unpleasant odors.”
In Lady Jennifer’s version, the wet stream goes where it should have gone all along: into controlled biology. Food scraps and other organics are pulled into anaerobic digestion to produce biogas and a treated digestate that can become compost where it meets strict standards, instead of rotting in open dumps. As she puts it, “Wet waste becomes an asset when it goes through digestion and controlled processing. The dry stream then feeds syngas and hydrogen, not just a boiler.”
The dry stream is treated as a flexible feedstock factory, not a single fuel for a single flame. After front end sorting and conditioning, it is converted in low oxygen conditions into syngas and hydrogen rich gas, with the option to upgrade into fuels like methanol or SAF where volumes and offtakers justify it.
This architecture naturally generates several revenue lines: biogas or biomethane, compost, metals and recyclables, syngas or hydrogen, and a much smaller, more inert residue. It also exposes how narrow the current megawatt lens is.
How to pay for diversion, not burning
Indonesia’s waste-to-energy rules via PP 109/2025 still lean on a power logic: projects are framed around megawatts installed and kWh exported, with tariffs and incentives tied to electricity generation instead of how much waste is actually taken out of dumps or landfills. That drift away from waste-handling is exactly what officials at the Ministry of Environment have been warning about.
As Edward Nixon Pakpahan, Director for Air Quality Protection and Management (Ministry of Environment), put it in Waste to Energy Investment Forum 2025: “At the beginning there was a clear dichotomy: are we trying to solve the waste problem or generate energy? If you ask the Ministry of Environment, our priority is to resolve the waste; energy is a bonus. But now the focus has shifted to energy generation. Once we start talking about energy, the calculations change and everything tends to be judged in terms of investment economics and profit and loss.”
Under the current model, Indonesian cities guarantee minimum tonnage, while power offtakers pay per kWh. This quietly rewards high throughput and punishes any effort to reduce waste or improve segregation. A performance model has to flip that mindset with a modest base fee for secure capacity, then upside tied to how much waste is diverted from landfill, how clean the compost, gas, and fuels are, and how consistently the plant stays within environmental limits.
Electricity buyers and fuel offtakers still matter, but as partners who help define specs and ramp-up curves, not as the only reason the plant exists. Farmers and soil users also become part of the value chain when digestate is upgraded into safe compost instead of being dumped.
Lady Jennifer points to real-world proof that this is not theory. Referring to State systems that link money to recycling performance and container deposit schemes that pay households for bringing back clean material, she notes, “Australia already shows the way – payments tied to diversion and quality, with bottle returns rewarding clean inputs.”
On the operations side, “International partner data, including India, shows modular dry fraction lines can divert a 35-55% from landfill, stabilise moisture even through monsoon seasons, and maintain around 85-95% uptime.”
What this means for Indonesia’s energy transition
If Indonesia keeps treating waste-to-energy as a side-door way to add a few megawatts, it will keep getting the wrong projects. The real priority in sustainable waste management is safe handling and reduction of waste, not kWh for their own sake.
Under PP 109/2025, waste-to-energy projects built around incineration typically demand a minimum 1,000 tonnes per day feedstock guarantee. That immediately excludes most Indonesian cities and forces participating regions to over-concentrate waste into one mega-facility just to make the numbers work. The country end up designing around the hunger of the burner, not around what is best for the overall national waste system.
BlueGas’ approach hits that point from the other side. Their technology is scalable down to where most Indonesian cities actually sit, not just up to where PP 109/2025 draws its minimum line. That portfolio mindset is exactly how Indonesia “keep options open” in an energy transition.
“Direct electricity generation is rarely efficient… More viable pathways focus on a mix including chemical conversion, producing syngas for industry, hydrogen for clean manufacturing, and in larger centres such as Jakarta, even Sustainable Aviation Fuel.”
For cities and PLN, electricity should be treated as one of several outputs, not the justification for everything. For investors, the safer long-term bet is on platforms that can scale to smaller cities, survive messy feedstock and politics, and shift between gas, fuels, and new industrial uses as markets evolve, instead of being chained to a 1,000 tpd incinerator business model.
Indonesia’s waste-to-energy story will either stay trapped in megawatt thinking and minimum-tonnage guarantees, or move toward systems that treat waste handling, multiple outputs, and verifiable performance as the core. Lady Jennifer’s message is simple: start designing for the waste, the cities, and the future options you want to keep open. ***
