Indonesia has a new approach to its energy sector, positioning it to become an engine of economic growth . How will you go about making this reality?

My job is to send a realistic message. . Most of the output of the sector is influenced by the global economy and global politics. We see these dynamics in our electricity tariffs: our electricity production costs are influenced by coal or gas prices, international pressures, supply, and political problems as recently seen in Qatar. We therefore have to be realistic on how we face this.

It makes sense that the energy sector should support local industry, but what role are they supposed to play within this scenario in the future?

Business carries certain risks and no institution can guarantee that their activities will be 100% reimbursed.  What the government can do at the moment is to ensure fair market conditions and an open and transparent dialogue with the business community: a fair basis for businesses for either foreign or local investors.

The government wants 23% of the national energy mix coming from renewable by 2025, but the main drawback is that the pricing is too volatile for long term planning.

If we enter into a contract it will be for 20 years and at a fair price. What we think is that so far there are close to 350 megawatts of renewables being committed and around 200 companies bidding for these concessions. We will choose projects where quality and price are matching. This technology is not rocket science any more.

Which area of renewables would you see as interesting for Indonesia to support?

We are always looking to develop renewables which are naturally abundant. One is geothermal, we simply cannot accept any cost because of failures in exploration. The second area is wind power which is now growing in certain parts of Indonesia, but which is not yet viable across the country. The third is solar: the radiation absorption rate here lies at a maximum of 60% compared to our peers in the Middle East, but the price cannot be 15 cents per kilowatt hour (KWH). In the Middle East, they currently reach prices of 2,42 cents per KWH. We understand that we cannot reach these numbers here, but this should be our benchmark; we see 5-6 cents as realistic.

How do you rate environmental issues?

We have about 255 million people in this country, if they have to vote whether they take an affordable electricity tariff or they take a less affordable electricity tariff while helping the environment? I don’t know. Our main goal is to make electricity tariffs affordable. Indonesia has to focus on the cheapest source of energy. This is the bottom line for us.

At current prices, this would mean coal?

Well it depends, I believe that hydro power is competitive with coal, and geothermal, wind power and especially wind and solar power should be able to compete with coal.

In terms of state owned companies such as PERTAMINA, PGN or PLN, how are they adapting to this new paradigm of energy policy in Indonesia?

We give an equal platform to state owned companies and private companies. There is no regulation that will prioritize the government companies expect for public service obligations: the main focus for us is efficiency.

Why is the mining sector attractive for local and international investors?

I think policies are transparent for any investor, but I believe, once again, that it depends on the trend of the price of the minerals itself. If the price of the minerals is not lucrative in the world market, the overall appetite will be equally poor. We can make Indonesia more attractive by improving our licensing and investment processes. These need to be made clearer, but my message is that Indonesia is a big market, that the business environment is friendly compared to other regions in the world and that we are improving governance. Are we still facing challenges? Of course, but that’s part of life.

How important would you say it is that Indonesia and its views is present in the international arena, by for instance in reports such as in TIME magazine?

In my opinion, we cannot close the door. In fact, I don’t believe any country can close its door any more.

Whether you speak about power, oil & gas, renewables or the mining sector, they are all long-term businesses. Therefore, I would suggest to investors in Indonesia to keep in mind that these are long term investments.

Business cannot be conducted with a short term mindset. Investors can trust our regulations and work transparently with us. In the past, foreign investors have looked for local partners, giving them free stakes in return for aid navigating the process. There is no need for this anymore.