From 2013 to 2019, the length of Power Purchase Agreements (PPA) for wind energy in Indonesia remained stable at 18 years. A notable upward trend began in 2020, with the PPA length increasing to 19 years, marking a year-on-year variation of 5.56%. The upward trajectory continued with PPAs reaching 20 years in 2021, 21 years in 2023, and forecasts show a further extension to 23 years by 2026 and 24 years by 2028. As of 2023, the PPA stands at 21 years. The compound annual growth rate (CAGR) for the last five years is 3.13%, indicating a steady increase in agreement lengths.
Future trends to watch for include:
- The impact of regulatory changes and government incentives on PPA durations in the renewable energy sector.
- The influence of technological advancements and decreasing costs in wind energy on contract lengths.
- Potential shifts in market dynamics and investor confidence that could further extend PPAs beyond current forecasts.