Masdar has announced an investment in Indonesia-based Pertamina Geothermal Energy (PGE) to make its entry into the geothermal energy market.

With the investment, the UAE’s state-owned renewable energy company expects to expand its footprint in the Asia-Pacific region.

Masdar didn’t reveal the amount it invested in the Indonesian geothermal player.

Pertamina Geothermal Energy currently has 13 geothermal working areas with a portfolio capacity of over 1.87GW. Of this, 672MW is from its own operation, and 1.2GW is from joint operation contract.

The company has been operating geothermal facilities in Indonesia for the past 40 years.

Pertamina Geothermal Energy CEO Ahmad Yuniarto said: “We look forward to working with Masdar in the areas which complement and grow further our capabilities to be a world class green energy company, with the largest geothermal capacity globally.

“We endeavour to develop 600MW in additional installed capacity over the next five years to support Indonesia’s renewable energy mix.”

Indonesia aims to increase its installed geothermal capacity from 2.8GW in 2022 to 6.2GW by 2030, said Masdar.

The government intends to achieve net-zero emissions by 2060 and to have renewables account for 23% of the energy mix by 2023.

According to Masdar, geothermal energy is a stable, dispatchable, clean renewable resource that helps balance the intermittency of solar and wind.

The company stated that geothermal energy can possibly play a key role in the clean energy transition, helping countries with a high concentration of geothermal activity to lower their carbon emissions.

Masdar CEO Mohamed Jameel Al Ramahi said: “Masdar’s strategic investment in PGE will complement our already strong footprint in Indonesia, the world’s second largest geothermal market.

“We are especially excited to add geothermal energy to our clean energy portfolio, a clean energy source that can deliver dispatchable power 24 hours a day, which further underscores our position as a global leader in delivering clean energy solutions that help drive the global energy transition.”

In Indonesia, Masdar is already building the 145MW Cirata floating solar photovoltaic (PV) plant.

Besides, the company forged an agreement with Tuas Power, EDF Renewables, and PT Indonesia Power in 2022 to develop up to 1.2GW solar capacity in Indonesia for export to Singapore.