By: Ardian Prasetyo
The government’s efforts to address the national waste emergency through the waste-to-energy program managed by the Daya Anagata Nusantara Investment Management Agency (BPI Danantara) should be viewed as a strategic step that underscores a new direction in Indonesia’s environmental management. With national waste production exceeding 56 million tons per year, the problem can no longer be addressed with conventional methods that rely solely on landfills. The complexity of this issue demands a nationwide solution that does not simply relocate the problem, but transforms it into new value for long-term national interests. Through Presidential Regulation No. 109 of 2025, the government demonstrates the courage to adopt policies that place technology as an integral part of sustainable development.
Since Danantara accelerated the waste-to-energy process, new optimism has emerged that Indonesia can convert waste into a renewable energy source. Deputy Speaker of the People’s Consultative Assembly (MPR RI), Eddy Soeparno, stated that the government’s steps with Danantara are timely, as waste conversion programs have struggled for over a decade due to technical and economic challenges. He explained that Danantara’s new model provides funding certainty, improves partner selection criteria, and ensures that investment returns to the state, creating a long-term capital cycle. This illustrates that the government positions Danantara not merely as an operator but also as an investor ensuring that the project runs efficiently and sustainably.
This new approach is crucial because Indonesia faces a major imbalance between waste volume and processing capacity. With recycling potential absorbing only around 40 percent nationally, the remaining 60 percent requires technology-based processing capable of operating continuously. Waste-to-energy offers an answer because it reduces waste volume while producing stable electricity to support urban energy needs. Economically, the twenty cents per kilowatt-hour scheme provides tariff certainty without burdening the state budget, while carbon credit opportunities strengthen investor interest in participating more broadly.
Public policy expert from Muhammadiyah University of Makassar, Hafiz Elfiansya Parawu, believes the program has long-term prospects because it simultaneously integrates environmental, public health, and energy issues. He emphasized that reducing waste volume not only saves landfill space but also significantly reduces emissions. According to him, without serious development, Indonesia will face a dual burden: rising waste volume and increasing energy demands each year. This perspective shows that waste-to-energy is not merely a technical project but part of the strategy to achieve the government’s Net Zero Emissions 2060 target.
Danantara has demonstrated its seriousness by preparing partnerships involving experienced local and international companies through the Selected Provider List for the Waste-to-Energy Project (BUPP PSEL). Managing Director of PT Danantara Investment Management, Stefanus Ade Hadiwidjaja, explained that 24 companies were selected based on track record and technological capability to ensure project implementation in seven cities proceeds rapidly and measurably. He also emphasized that Danantara provides ample room for local partners to participate in the consortium so that knowledge transfer and capacity building can take place simultaneously. This aligns with the government’s agenda not only to solve waste problems but also to foster the growth of a domestic renewable energy industry ecosystem.
Lessons from other countries serve as important references for Indonesia. Stefanus cited how China manages approximately 1.5 billion kilograms of waste daily using modern incinerator technology that produces minimal emissions, while its residue can be processed into construction materials. This example shows that successful waste-to-energy implementation is not impossible, provided that strong policies, transparent governance, and consistent investment are in place. With its large population and increasing rate of urbanization, Indonesia faces similar urgency, making the adoption of advanced technology a necessity, not an option.
The government, under the leadership of President Prabowo Subianto, has also placed strong emphasis on this priority. The government’s focus on accelerating the development of technology-based waste processing infrastructure positions Danantara’s projects as an integral part of national policy. Danantara’s projection that waste-to-energy can address up to 10 percent of the national waste problem indicates its tangible contribution, especially when implemented gradually and integrated with local waste management systems. Coordination with regional governments, including land provision and stable waste supply, is essential to prevent administrative barriers that previously hindered waste-to-energy development in various regions.
Considering policy direction and implementation readiness, waste-to-energy is not only an environmental solution but also a strategic investment for Indonesia’s energy future. Beyond creating stable and environmentally friendly electricity sources, the program reduces dependence on fossil fuels and strengthens national energy security. Within the circular economy framework, processing residues into construction materials opens new industrial opportunities that absorb labor and stimulate local economies. If implemented consistently, this project has the potential to become a milestone that transforms Indonesia’s waste management approach while strengthening the foundation of renewable energy.
*) Energy and Environmental Policy Analyst