How Trump's Tariffs Could Boost Indonesia's Solar Panel Market

The Indonesian government has welcomed the recent imposition of additional import tariffs by the United States on solar panel products, seeing it as a chance to bolster the domestic solar panel industry. Elen Setiadi, Deputy for Coordination of Energy and Mineral Resources at the Coordinating Ministry for Economic Affairs, stated that this development presents an opportunity to expand the use of solar panels within the country.

The Indonesian solar module industry had previously exported to America but can now benefit from the tariffs, Elen explained, as reported by Antara news agency on September 30, 2026.

The country's solar module industry already boasts a production capacity of approximately 11 gigawatts (GW) annually, which could significantly accelerate the development of solar power plants. A target of 100 GW could lead to the creation of up to 5.5 million green jobs, cut CO2 emissions by roughly 140 million tons, and save up to Rp74 trillion yearly. Strengthening the solar panel industry is crucial to meet these ambitious targets and generate substantial economic benefits.

At present, there are 34 domestic solar module manufacturers with a combined annual output capacity of 10,994 megawatts peak (MWp). These modules can reach a maximum output of 720 watts peak (Wp) each, with a domestic component level ranging between 40-55 percent. Despite these achievements, the industry grapples with several challenges, such as a slow pace in solar power plant project implementation and the fact that the minimum solar panel components requirement permits the use of imported modules.

Furthermore, the government acknowledges that rooftop solar quotas have not been fully utilized, leaving many requests from the industrial sector unmet.

To address these issues, Elen emphasized the importance of bolstering the domestic market alongside supply chain development to minimize reliance on foreign markets, particularly for critical raw materials like wafers and ingots. She proposed non-fiscal incentives to promote the use of domestic solar modules, such as offering larger rooftop solar quotas for users who opt for locally produced products.

If the 100 GW target is achieved, her industry could thrive and create the desired impact. In conclusion, the Indonesian government encourages collaborations between local and global companies to foster investment, technology transfer, and enhance the national solar panel supply chain.