Danantara to Manage $5.5 Billion Waste-to-Energy Project, Backed by Prabowo’s Green Policy Drive

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JAKARTA, Investortrust.id — The Indonesian government has launched a Rp 91 trillion waste-to-energy initiative under President Prabowo Subianto’s administration, a flagship green-infrastructure effort that will be financed and managed by state investment agency Danantara without drawing from the Ministry of Public Works and Housing’s budget.

Deputy Minister of Public Works Diana Kusumastuti said on Monday, Oct 13, 2025, that the project aims to turn Indonesia’s mounting waste problem into a sustainable energy source through a public-private partnership scheme involving Danantara, PLN, and several related ministries.

“It will not be financed from our ministry’s state budget. During the harmonization meeting, it was decided that Danantara will manage the project through a PPP mechanism,” Diana told reporters at the ministry’s Jakarta office. She added that the Ministry of Environment, PLN, and the Ministry of Energy and Mineral Resources would jointly oversee its execution.

The waste-to-energy (WtE) program is expected to address what officials describe as a “ticking time bomb” in Indonesia’s waste management system. The country generates roughly 70 million tons of waste each year—up from 68.5 million tons in 2021—with over half originating from households and the majority ending up in overcapacity landfills.

“The slow pace of waste treatment has become a real ecological time bomb,” Diana warned, noting that only 10–15 percent of total waste is currently recycled while the rest burdens local dumping sites. “If local governments continue closing landfills without new processing methods, we will soon face another crisis.”

President Prabowo’s government has made the WtE push a national priority, positioning it as a cornerstone of his environmental and energy agenda. “Turning waste into energy is a strategic step because unmanaged waste has long been a serious issue,” Diana said. “Through cooperation with PLN, waste can be converted into electricity to benefit local communities.”

The initiative will begin with 10 priority cities—including Jakarta, Bandung, Yogyakarta, Semarang, Surabaya, Tangerang, Bali, and Makassar—before expanding to 33 urban centers nationwide.

CEO of Danantara Rosan Perkasa Roeslani said the program has drawn significant investor interest from both domestic and foreign institutions in China, South Korea, the Netherlands, Germany, Japan, Australia, Singapore, and Malaysia. “Interest levels are quite high,” Rosan said recently. “This is an opportunity to create long-term, sustainable energy infrastructure.”

Coordinating Minister for Infrastructure and Regional Development Agus Harimurti Yudhoyono emphasized that major cities such as Jakarta, which produces 7,000 to 8,000 tons of waste daily, and Surabaya or Medan with 1,000–1,500 tons each, require systemic solutions spanning reduction, sorting, and energy conversion.

“Waste management cannot be trapped in a single phase,” he said during the Indonesia International Sustainability Forum 2025. “Every stage—from reduction to recycling—must move together.”

Agus added that adequate funding would determine the project’s success. The PPP model and Danantara’s Patriot Bond financing—worth Rp 50 trillion so far—are expected to accelerate the rollout of WtE facilities across the country.

“We will ensure governors, regents, and mayors have aligned visions,” Agus said. “Without financing, no advanced technology can take root.”

Officials also underscored the importance of community participation and local readiness. “Municipal governments must understand the process so the system can run effectively and sustainably,” Diana noted.

With Prabowo’s endorsement, Danantara’s Rp 91 trillion WtE plan marks a new stage in Indonesia’s green transformation—integrating environmental recovery, investment mobilization, and circular-economy growth.