Highlights

• Indonesia possesses significant nickel, cobalt, and rare earth mineral reserves crucial for global clean energy transition.
• Study exposes systemic gaps in mineral governance, including weak supply chain management and low renewable energy penetration.
• Recommendations include strengthening downstream industries, adopting circular economy principles, and fostering international collaboration to maximize mineral potential.

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A new peer-reviewed study led by Andrew Cahyo Adhi of the PLN Research Institute and Muchammad of the Department of Mechanical Engineering, Diponegoro University explores Indonesia’s vast reserves of nickel, cobalt, and rare earth elements (REEs) as foundations for the nation’s energy transition. Published in Advance Sustainable Science, Engineering and Technology (ASSET), the paper, “Unlocking Indonesia’s Critical Minerals for Renewable Energy: Challenges and Pathways to Net-Zero Emissions”, highlights both the opportunities and systemic vulnerabilities in aligning mineral wealth with climate goals.

Key Findings

The authors integrate Life Cycle Assessment (LCA), criticality matrix analysis, and value chain mapping to examine Indonesia’s mineral governance. Their analysis shows that despite being richly endowed with critical minerals, Indonesia faces significant structural gaps:

• Weak supply chain management undermines the government’s Local Content (TKDN) targets.
• Dependence on fossil fuels persists, with renewables supplying only 14% of energy in 2020 despite ambitious climate targets.
• High accident rates in mining highlight urgent safety and sustainability challenges.
• Missed opportunities in value creation, as much of Indonesia’s production remains stuck in upstream extraction rather than downstream refining and manufacturing.

The research calls for strengthening downstream industries, adopting circular economy principles, and fostering international collaboration. Policy recommendations include simplifying regulations, boosting R&D investment, and tightening environmental standards to transform Indonesia from a raw material supplier into a strategic clean-energy hub.

Implications

For investors and policymakers, the findings underscore Indonesia’s pivotal role in global supply chains for EV batteries, wind turbines, and solar technologies. With the International Energy Agency (IEA) projecting mineral demand to double by 2040, Indonesia could emerge as a global swing supplier. But without systemic reforms, its mineral wealth risks reinforcing dependency rather than powering a resilient green economy.

Limitations

The authors note that their study is qualitative and exploratory, relying on value chain modeling rather than quantitative market forecasting. The work highlights governance and sustainability issues but does not provide costed deployment scenarios for renewable energy technologies. Moreover, environmental externalities, while acknowledged, require deeper empirical study at the mine and community levels.

Conclusion

Indonesia holds the keys to critical minerals that could accelerate the global clean energy transition. Yet, as this study makes clear, resources alone are not enough. Without coordinated reforms—spanning regulation, technology transfer, and international cooperation—Indonesia may struggle to convert geological advantage into climate leadership. For global markets, the message is clear: Indonesia’s trajectory will influence not only supply security but also whether the green transition can truly be sustainable.

Citation: Adhi, A.C., Priambodo, N.W., Muchammad, Utomo, T.S., Abdrian, R.K.A.S. (2025). Unlocking Indonesia’s Critical Minerals for Renewable Energy: Challenges and Pathways to Net-Zero Emissions. Advance Sustainable Science, Engineering and Technology (ASSET), Vol. 7(4). DOI: https://doi.org/10.26877/asset.v7i4.200502504010-01 (opens in a new tab)

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