Indonesian Geothermal Projects Stall Amid Indigenous Concerns over Justice

Why It Matters

The suspension jeopardizes Indonesia’s geothermal capacity, a key pillar of its net‑zero roadmap, while underscoring that renewable projects must respect Indigenous consent to avoid costly delays and social conflict.

Key Takeaways

• 21 geothermal sites identified on Flores in 2017.
• World Bank withdrew funding in Dec 2023 over FPIC failures.
• KfW suspended Poco Leok project in Nov 2024.
• Communities cite health risks, farmland loss, cultural disruption.
• Stalled projects illustrate green extractivism and sacrifice zones.

Pulse Analysis

Indonesia has long positioned geothermal energy as a cornerstone of its transition away from coal, with the island of Flores earmarked to host up to 21 sites. International lenders such as the World Bank and Germany’s KfW poured capital into feasibility studies, betting on the country’s abundant volcanic resources to supply baseload renewable power. The promise of low‑carbon electricity attracted both domestic policymakers and foreign investors, framing Flores as a model for scaling geothermal across the archipelago.

Yet the project collided with the concept of *ruang hidup*, the Manggarai peoples’ holistic claim to land, livelihood, and spiritual heritage. When developers failed to secure free, prior and informed consent, communities organized under customary *adat* law, highlighting health risks from emissions and threats to agricultural plots. The World Bank’s 2023 funding pull‑out and KfW’s 2024 suspension signaled a turning point, showing that inadequate stakeholder engagement can derail multi‑billion‑dollar investments. For developers, the episode stresses the need for transparent consent processes, robust impact assessments, and genuine benefit‑sharing arrangements.

The Flores case exemplifies a broader pattern dubbed “green extractivism,” where environmentally framed projects generate profit for external actors while externalizing social and ecological costs onto local populations. As nations race to meet climate commitments, the lesson is clear: renewable infrastructure must be coupled with inclusive governance to avoid creating “sacrifice zones.” Indonesia’s experience may prompt lenders and governments worldwide to embed stronger Indigenous rights safeguards into project financing, ensuring that the pursuit of clean energy does not repeat the same social conflicts that have plagued other extractive sectors.