In the midst of a surge in global ambition for decarbonization, Indonesia faces a stark paradox: this country with giant renewable energy potential still leaves 658 thousand families living without electricity at all. Meanwhile, 1.17 million other households still depend on diesel generators that are expensive and high-emission.

However, the energy transition is not only determined by large-scale power plant projects or international agreements. In many regions, especially in remote areas, change actually grows from community initiatives that manage their own energy sources. It grows from communities that take control over the energy sources in their areas. This is what is called a community-based energy transition. This approach places the community no longer merely as electricity consumers, but rather as owners, managers, and primary beneficiaries of clean energy.

What Is Community-Based Energy Transition?

Community-based energy transition is a process of shifting from fossil energy sources to renewable energy that is designed, owned, managed, and utilized directly by the community at the local level. In this model, villagers or community groups do not wait for big projects from the central government or corporations. They utilize local natural resources: sunlight, river flows, agricultural waste, or wind. Everything is managed to produce electricity and energy independently.

IRENA (International Renewable Energy Agency) defines an energy community as an initiative where citizen participation and ownership in renewable energy projects create local socio-economic value while strengthening public support for the energy transition.

In Indonesia, this approach often manifests in three main models:

What makes the community approach different from a centralized energy transition? It is not a matter of power plant size. The most fundamental difference is in who holds control:

Crisis Portrait: When the Energy Transition Has Not Touched Everyone

Until the end of December 2025, the contribution of renewable energy to total electricity generation in Indonesia only reached 15.75%. Coal still dominates with a share of 68% of total national electricity production. More broadly, until 2023, Indonesia's national energy mix was still dominated by fossil energy with a percentage reaching 86%.

The most striking inequality is seen in Eastern Indonesia (KTI). Highland Papua and Central Papua have the lowest electrification ratios, while the renewable energy potential there is actually very large. Data from 2024 shows there are still around 658 thousand families who have no electricity access at all. Most are concentrated in 3T areas (frontier, outermost, underdeveloped).

Ironically, in many of these remote villages, diesel generators become the only source of electricity. Fuel is expensive, supply is unstable, and carbon emissions are high. Data from CELIOS (2026) records that around 1.17 million families still depend on non-PLN electricity sources, which in many cases means diesel.

According to Muhamad Saleh, an energy researcher, in The Conversation (2026), a just energy transition should not only talk about green investment, construction of new power plants, or achieving national energy mix targets. The energy transition must ensure that the entire community has access, ownership, and economic benefits from the energy sources available in their regions.

Why is the Community Approach Actually More Effective?

Economic Argument: Benefits of Rp18,000 Trillion

Research conducted by CELIOS together with 350.org shows that if Indonesia is serious about shifting the energy transition paradigm from large scale projects to community scale, the potential economic benefits that can be created reach Rp18,000 trillion. This figure includes local job creation, diesel fuel cost savings, and the multiplier effect of economic circulation at the village level.

Environmental Argument: Significant Emission

Reduction A study published in ScienceDirect (2024) shows that the shift from diesel to biomass in small-scale power plants is capable of reducing emissions by up to 83.7%. Meanwhile, from the cost perspective, the LCOE (Levelized Cost of Electricity) of biogas reaches 0.045 USD/kWh and biomass 0.061 USD/kWh, figures that are much more competitive compared to diesel at the level of 0.168 USD/kWh.

Social Argument: Ownership Creates Sustainability

Research from Germany, the UK, and Denmark compiled in the Journal of Energy and Resilience (2025) shows that community energy projects have higher sustainability rates because citizens are not only consumers, but also producers and managers. This sense of ownership drives better maintenance as well as stable long-term operations. [EXTERNAL LINK: Jurnal Energi dan Ketahanan Vol.1 No.1, Sept 2025]

Case Study: PLTMH Kedungrong, Kulon Progo, Yogyakarta

Kedungrong Hamlet was once completely paralyzed after a landslide disaster in 2001. Citizens then initiated the fulfillment of their own energy needs. By utilizing the potential of the Kali Bawang irrigation flow, they built a PLTMH (Micro-Hydro Power Plant) which began operating in 2012.

The result: PLTMH Kedungrong now supplies 80% of the citizens' electricity needs, covering 55 heads of households as well as dozens of streetlights. Citizens are directly involved in planning, operation, and maintenance. More than just lighting, this electricity supports the economic activities of the citizens.

Source: The Conversation, February 2026

“Involve community participation. Build renewable energy in accordance with the community's imagination.”

— Iskandar Budisaroso, Founder of IBEKA, in the CIPP JETP 2023 forum

Evidence from the Field: Community Energy Projects That Are Already Running

The community-based energy transition has already moved past the concept stage. In various corners of Indonesia, communities have already proven that they are capable of planning, building, and managing renewable energy sources independently. The following eight projects and models show the diversity of approaches, ranging from micro-hydro to rubber seed biodiesel and agricultural waste.

1. PLTMH Kali Maron, Seloliman Village, Mojokerto (East Java)

   Since 1994, citizens of Janjing Hamlet on the slopes of Mount Penanggungan built a PLTMH from the flow of the Maron River. They did not wait for the PLN grid that never arrived. Paguyuban Kalimaron was formed as the management body, with management consisting of citizens, PPLH Seloliman, and the village government.

   The PLTMH capacity was increased from 12 kW to 25 kW in 2000, and now illuminates around 30 households with a power of 450–2,500 watts per house. The tariff is 10% below the PLN tariff. What is unique: 80% of the electricity generated is actually sold to PLN, so this PLTMH is not only a source of lighting, but also a source of income for the community. Electricity also revives cottage industries, such as food processing.

The appearance of the turbine house and water control tank of the Kali Maron PLTMH in the rice field area in Sempur Hamlet, Seloliman Village. The Maron power plant was built by the citizens of Janjing Hamlet, Seloliman Village, Trawas District, Mojokerto Regency, East Java, to meet the electricity needs in their village. (KOMPAS.COM/MOH. SYAFIÍ)

2. Energy Independent Village of Kamanggih, East Sumba (NTT)

   Kamanggih is the first village on Sumba Island to develop a PLTMH, as part of the Sumba Iconic Island initiative pioneered by the Ministry of Energy and Mineral Resources, Bappenas, and Hivos since 2010. Now the community cooperative sells electricity from the PLTMH to PLN, and citizens enjoy a 24-hour electricity flow.

   Kamanggih has an integrated approach: besides electricity from micro-hydro, citizens also develop biogas from livestock waste for cooking, replacing firewood and kerosene. This combination of PLTMH + biogas makes Kamanggih a model for an energy independent village that combines electricity and cooking needs simultaneously.

Utilizing water resource potential to head towards an energy independent village. Photo: Ebed de Rosary/Mongabay Indonesia

3. Sumba Iconic Island: Island-Scale Community Energy Laboratory

   The Sumba Iconic Island initiative is proof that a community-based energy transition can scale larger than a single village. Starting in 2010, this program successfully increased Sumba's electrification ratio from 24.5% (2010) to more than 50% (2018), with the renewable energy contribution reaching 55%. The inflowing investment reached more than Rp135 billion, covering PLTS, PLTB (wind), PLTMH, biogas, and biomass.

   In Sumba, solar powered irrigation initiated together with the local community even transformed dry savanna land into vegetable gardens, allowing farmers to harvest during the 8 month long dry season. Community energy turns out to be not just about electricity. It is about a complete livelihood transformation.

Photo: Dok. Asian Development Bank

4. PLTMH Silit Hamlet, Sintang (West Kalimantan)

   In the interior of West Kalimantan, the community of Silit Hamlet built a PLTMH with a capacity of 25–45 kW capable of providing lighting for 4 surrounding villages. Focus Group Discussions (FGD) documented by WALHI (2025) show that although this project was successful, citizens face a threat to sustainability from the entry of the PLN grid which could cause their community technology to be sidelined.

   The Silit case becomes an important lesson: technical success alone is not enough. Regulatory protection is needed so that the energy infrastructure already built by the community does not become "scrap metal" when the PLN grid enters. This situation frequently occurs in community energy projects.

5. PLTMH Kedungrong, Kulon Progo (Yogyakarta)

   As mentioned in the previous section, Kedungrong Hamlet built a PLTMH post-landslide disaster in 2001. Electricity from the Kali Bawang irrigation flow now supplies 80% of the needs of 55 heads of households. Interestingly, this project was born from an emergency situation, when citizens initiated a cheap and fast energy solution while infrastructure was paralyzed. This model proves that an energy community can be a response to a crisis, not merely a planned development program.

6. Biodiesel from Rubber Seeds: Great Potential from Plantation Waste

   Indonesia has the largest rubber plantation area in the world, yet rubber seeds so far have had almost no economic value and are only used as seeds. In fact, research shows that rubber seeds contain 40–50% vegetable oil that can be processed into biodiesel through esterification and transesterification processes.

   In West Kalimantan, where smallholder rubber plantations are widespread, the development of community-based rubber seed-based biodiesel offers a double opportunity. Rubber seeds that so far have had almost no economic value can be processed into a local energy source to reduce dependence on expensive diesel fuel in remote areas. At the same time, this scheme opens up additional income opportunities for rubber farmers. Organizations like MADANI Berkelanjutan have been encouraging the development of community-based bioenergy that utilizes rubber seeds and other local plants as alternative raw materials besides palm oil.

Riza Egi Arizona, Program Officer, Community-Based Bioenergy, at the Hulu Indonesia Festival 2025, Putussibau, Kapuas Hulu, West Kalimantan, is demonstrating how rubber seeds are processed into an energy source. Photo: Doc. Pandu Padmanegara

The MADANI Berkelanjutan study in Kapuas Hulu Regency, West Kalimantan, places rubber seeds as one of the most promising second-generation biofuel raw materials, with a yield value of 40–50%, equivalent to tamanu/nyamplung (40–70%) and higher than jatropha (35–45%). Kapuas Hulu stores thousands of tons of rubber seed potential per year that has so far gone to waste. This study answers a real need: in West Kalimantan there are still around 200 villages that have not been electrified, and in Kapuas Hulu itself 27 villages are not yet electrified, with the PLN electrification ratio at only 72.84%. Besides rubber seeds, MADANI mapped out dozens of other local raw materials in this region, ranging from elephant grass, calliandra, tengkawang seeds, leban wood, corn cobs, molasses, used cooking oil, fish washing water, to palm shells and palm oil mill effluent (POME). MADANI is currently preparing a roadmap and prototype for community-based rubber seed crude oil processing around the forests of Kapuas Hulu.

7. Nyamplung: Non-Food Bioenergy from Degraded Land

   

   
   

   The nyamplung plant (Calophyllum inophyllum) is a native Indonesian species currently being developed by BRIN as a forest-based bioenergy source. Its productivity is extraordinary: 20 tons per hectare/year with an oil yield reaching 60% of the dry seed weight. Nyamplung oil (Tamanu Crude Oil) can be processed into biodiesel, biokerosene, and even sustainable aviation fuel (SAF).

   Why is nyamplung suitable for community energy transition? This plant can be grown on degraded land, including peatland, does not compete with food, and has begun to be managed on a community basis. In Gunungkidul, Yogyakarta, the Al-Hadid Islamic Boarding School has even sold more than 10 liters of nyamplung oil per month and plans to produce biodiesel from its backyard. In West and Central Kalimantan, BRIN is piloting nyamplung planting through paludiculture patterns on degraded peatlands.

   Riza Egi Arizona from MADANI Berkelanjutan emphasizes that community bioenergy development must utilize agroforestry systems, instead of monoculture, and be managed by the community so that the benefits are distributed fairly.

   This claim is based on spatial data. The MADANI Berkelanjutan synthesis (2022) cites research by Jaung et al. which identified 3.5 million hectares of degraded land in Indonesia suitable for five bioenergy species, namely calliandra, gliricidia (gamal), kemiri sunan, malapari, and nyamplung. Research by Leksono et al. even found 5.7 million hectares of degraded land specifically suitable for nyamplung, which is proven to have a survival rate above 90% on nutrient-poor and acidic ultisol soils. From the emissions side, non-food raw materials are superior: the total Global Warming Potential of jatropha is only 1,733.67 kg-CO2eq per ton of biodiesel, far below palm oil which reaches 2,568.82 kg-CO2eq per ton.

   This advantage is what places non-food and waste-based raw materials at the heart of biofuel diversification pushed by MADANI. Palm biodiesel triggers food-energy competition and demands additional land up to 5 to 15 million hectares according to various scenarios of B30 to B50 blending. Second-generation raw materials such as nyamplung, rubber seeds, jatropha, and used cooking oil can instead utilize degraded land as well as residues, making their social and environmental impacts much smaller. MADANI assesses that these principles of sustainability and diversification need to be regulated in legislation, including in the New and Renewable Energy Bill (RUU EBT).

   
   

8. Selayar, Gorontalo, and Agricultural Waste: Community Energy Across Raw Materials

   
   

   The footprint of the nyamplung community has a long history. The Selayar Islands, South Sulawesi, were once designated as an Energy Independent Village (DME) using nyamplung as raw material because it has around 1,742 hectares of naturally growing nyamplung stands. The Ministry of Energy and Mineral Resources even built a nyamplung seed processing factory with a capacity of 250 liters per day there, with one tree capable of producing 50 to 150 kilograms of seeds per year. Selayar holds an important lesson: without sustainable market and institutional assistance, facilities that have already been built can stop operating, which also threatens many other community energy projects.

   Community raw materials are not limited to vegetable oils. In Gorontalo, waste from corn cobs, the province's leading commodity, has been processed into bio-charcoal briquettes, bioethanol, and gas. Even coffee grounds have energy value: around 10 kilograms of coffee grounds can produce 2 liters of biodiesel. These examples confirm that the community energy transition is rooted in the local potential of each region and is capable of accommodating various raw materials simultaneously.

   
   

   
   

   Map of Community-Based Energy Transition Models in Indonesia

   • Micro-hydro (PLTMH): Seloliman (East Java), Kedungrong (Yogyakarta), Kamanggih (Sumba), Silit Hamlet (West Kalimantan), 80+ IBEKA locations

   • Communal Solar (PLTS): Sumba Iconic Island, Mata Redi & Mata Woga (Central Sumba), 2025-2029 Village Electrification (Lisdes) program

   • Livestock Biogas: Kamanggih (Sumba), Energy Independent Village Program in various regions

   • Rubber Seed Biodiesel: Great potential in West Kalimantan and other smallholder rubber plantation areas

   • Nyamplung Biodiesel/Biofuel: Gunungkidul (Yogyakarta), West & Central Kalimantan peatlands (BRIN trials)

   • Paludiculture + Wood Pellet: West Kalimantan (PBPH trials), gliricidia (gamal) as a coal substitute in PLN co-firing

   • Wind (PLTB): Sumba (wind speed 5.9 m/s), 167 GW potential in Eastern Indonesia

   Indonesia's Unoptimized Potential

   Eastern Indonesia holds massive renewable energy potential. Based on the 2025-2034 RUPTL, the solar energy potential in Eastern Indonesia reaches 165.9 GW and wind energy potential reaches 167 GW. Meanwhile, the National Long-Term Development Plan (RPJPN) 2024-2045 places Eastern Indonesia as the growth center for new and renewable energy with a renewable energy mix target of 70% by 2045.

   Village Potential Data from BPS (2021–2024) also shows an increase in the number of potential water resources (rivers, lakes, reservoirs, ponds, dams, and irrigation) that can be utilized for community-scale micro-hydro power plants. Indonesia also has an average solar radiation (GHI) of around 4.75 kWh/m² per day, making it one of the countries with the best solar energy potential in the region.

   Biogas potential is also significant. The National Energy General Plan (RUEN) targets a biogas contribution of 489.8 million m³ by 2025 and 1,958.9 million m³ by 2050. However, until 2020, the realization was only 27.86 million m³. This figure is still far from the target.

   Challenges That Must Be Overcome Together

   Great potential does not automatically become a solution. The community-based energy transition in Indonesia faces at least four main interrelated challenges:

   Four Main Challenges

   1. Infrastructure and Geographical Conditions. 3T areas have terrains that are difficult to reach, increasing logistics and installation costs. The PLN transmission grid does not yet cover many remote areas.

   2. Financing. The gap between target and realization of renewable energy investment remains wide. JETP stagnation and geopolitical uncertainties (including the US withdrawal from JETP commitments in early 2025) add to the funding challenges.

   3. Regulation and Governance. Licensing bureaucracy is still long. Centralized energy planning through PLN limits the space for community initiatives. Energy decentralization is not yet supported by an adequate regulatory framework.

   4. Local Capacity and Governance. After construction is completed, many village energy projects are hampered due to the lack of technical capacity of citizens for long-term maintenance, reporting, and financial management.

      Source: IEEFA

      
      

   The Path to Energy Democracy: What Can Be Done?

   The concept of energy democracy, a concept that understands energy transition as the redistribution of power from centralized structures toward broader public participation, offers a framework to overcome the challenges above. Several concrete steps that can be pushed:

   Energy Cooperatives and Energy BUMDes

   Encouraging the formation of village electricity cooperatives or Energy BUMDes that manage renewable power plants collectively. This model ensures the economic benefits of clean energy circulate at the local level, instead of being sucked into the center.

   Inclusive Financing Schemes

   Indonesia needs to prepare policies that encourage banks and venture capital institutions to finance more community-scale renewable energy projects. Financial instruments such as green sukuk, community mutual funds, or energy crowdfunding schemes can be a bridge for villages wishing to build their own power plants.

   Strengthening Decentralization Regulations

   The regulatory framework needs to give greater space to community energy initiatives outside the PLN scheme. The Village Electrification Program (Lisdes) for the 2025-2029 period, which targets grid construction in more than 10 thousand locations, is a good step, but it must be ensured that its implementation leaves room for community ownership.

   Strengthening Local Community Capacity

   Technical training, governance assistance, and post-construction knowledge transfer are keys to long-term success. Civil society organizations, including MADANI Berkelanjutan, play an important role as facilitators and bridges between communities, government, and the private sector in this process.

   MADANI's Role in Pushing for a Just Energy Transition

   MADANI Berkelanjutan, as a meeting point between thinkers, mobilizers, and decision-makers, drives the community-based energy transition through the CAIA approach: facilitating cross-party dialogue (Collaborate), strengthening advocacy for energy decentralization policies (Advocate), supporting contextual technological solutions (Innovate), and realizing real action with local communities (Activate).

   MADANI believes that the protection of forests and peatlands cannot be separated from energy policies. By encouraging community-based clean energy diversification and strengthening governance, the energy transition can become a tool to simultaneously achieve Indonesia's climate commitments and bring justice to communities that have been marginalized from the benefits of energy development so far.

   
   

   Frequently Asked Questions about Community-Based Energy Transition

   • What is an energy community?

   An energy community is a group of people who jointly plan, build, manage, and utilize renewable energy sources in their area. Villagers can generate their own electricity from solar panels, micro-hydro, or biogas.

   • What is the difference between community PLTS and household PLTS?

   Household PLTS (rooftop) is installed and owned by individuals for self-consumption. Community PLTS is built collectively by a group of citizens (usually through cooperatives or BUMDes) and distributes electricity to all community members. The scale is larger, the benefits are more evenly distributed.

   • How can a village start an independent energy transition?

   The initial step is to identify local energy potential (whether there are river flows, sufficient solar radiation, or biomass sources). Then, citizens can form a management group or energy cooperative, seek assistance from NGOs or government institutions, and access available financing schemes.

   • What is the role of local governments in the community energy transition?

   Local governments can integrate community-based renewable energy development plans into the RPJMD and spatial plans. They can also facilitate licensing, provide land, and connect communities with national as well as international financing programs.

   A just energy transition cannot rely on big projects from Jakarta alone. It needs to start from the community, from villages that have abundant natural resources but so far have no access and control over their own energy. As a first step, recognize the energy potential in your area, and start talking to neighbors, BUMDes, or the nearest assistance organization.

   
   

   Want to know more? Explore MADANI's Community-Based Energy Transition program and subscribe to the MADANI Newsletter to get the latest data updates and analysis regarding climate, energy, and governance issues in Indonesia.

   
   

   Reference List

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   • CELIOS & 350.org (2023). Peluang dan Tantangan Pendanaan Energi Terbarukan Berbasis Komunitas.

   • IEEFA (2026). Building Credibility in Indonesia’s Energy Transition: Insights from the ETM and JETP Indonesia.

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