Data center rules in Indonesia

The state utility and the main constraint on any project. It decides grid supply, sells the I-4 large industrial tariff and renewable energy certificates, and is signing very large supply deals. PLN Batam runs Batam's separate grid.

Sets electricity tariffs every quarter and has held them flat through 2026. It sets the rooftop solar rules and is pitching data centre power to investors.

They hold the environmental impact assessment (AMDAL) and building approval (PBG) a site needs before it builds. West Java's governor stopped a 640MW campus at Jatiluhur on 30 September 2026 because both were missing.

Licenses every operator through OSS, the online licensing system. Data centres need a business number and a standard certificate, and medium and large sites must sit in an industrial zone. Full foreign ownership is allowed.

BP Batam runs Batam, the main data centre market outside Jakarta, and now requires data centres that need large volumes of water to build their own seawater desalination plants. The council oversees special economic zones such as Nongsa Digital Park, where firms get tax relief and licences through one window.

Registers every electronic system operator and enforces the rule that public sector data stays in Indonesia. It runs the National Data Centre and has proposed tax breaks for data centres.

Reviews environmental impact assessments and water permits. Indonesia has no water benchmark for data centres, so each project is judged case by case.

Requires banks to host their systems and disaster recovery in Indonesia. Offshore placement needs its prior approval.

Requires domestic payment transactions to be processed in Indonesia.

Grants tax holidays. From 2026 relief can only bring the rate down to the 15 percent global minimum tax.

Is working on the renewable energy bill. The bill is expected to set rules for power wheeling, where a buyer takes private renewable power over PLN's grid.

Data centre operators register under business code KBLI 63112, which covers hosting and related activities. The activity is rated medium to high risk, so an operator needs a business number (NIB) and a standard certificate through OSS, the online licensing system. Medium and large sites must sit in an industrial zone.

Government Regulation 28 of 2025 sets the current risk based licensing system and revoked PP 5/2021. It took effect on 5 June 2025 and links licensing to the updated KBLI 2025 business codes. Existing licences stay valid under the new codes.

Data centre and cloud businesses in the private sector must register as an electronic system operator, known as PSE. Registration is required before a system starts serving users under PP 71/2019.

The data hosting business line under KBLI 63112 is open to foreign ownership up to 100 percent. Foreign owned companies still go through OSS and PSE registration.

Nongsa Digital Park in Batam is a special economic zone (KEK) set up by Government Regulation 68 of 2021. It covers 166 hectares and plans data centres. Firms there get licences through a single window run by the zone administrator.

The government built a National Data Centre (PDN) in Cikarang for state data, finished in March 2025. As of 15 December 2025 it had not started operations while it completed security requirements from BSSN, the cyber agency. A planned second site in Batam was dropped after loan talks with South Korea failed.

On 30 September 2026 West Java Governor Dedi Mulyadi stopped construction of BDx's 640MW AI campus at Jatiluhur in Purwakarta. Its environmental impact assessment (AMDAL) and building approval (PBG) had not been issued. He said the halt was over missing permits, with no environmental violation found. Construction had started on 22 September 2026.

PLN, the state utility, charges Rp 996.74 per kilowatt hour on the I-4 tariff for industrial users at 30,000 kVA and above. This rate still applied on 1 October 2026.

The government sets tariffs every quarter and kept them unchanged in the first quarter of 2026 to protect purchasing power. As of 2 October 2026 no decision for the fourth quarter had been announced, so third quarter rates still applied.

PLN offers premium service rates to customers who want higher reliability, under Energy Ministry Regulation 28 of 2016. The state auditor found PLN lost Rp 5.69 trillion in 2021 because these rates were not fully applied.

Batam is served by PLN Batam, which has its own tariff decision from the Energy Ministry. Its peak load is 841 MW in 2026 and is forecast to reach 2,540 MW by 2035. Data centres are expected to use more than half of Batam's peak load by 2029.

PLN sells renewable energy certificates (RECs), where each certificate stands for one megawatt hour of clean power. Buyers can claim renewable use without building their own plants. EDGE DC was the first Jakarta data centre to receive them in 2022.

Energy Ministry Regulation 2 of 2024 governs rooftop solar on customer sites. Excess power sent to the grid no longer reduces bills, and PLN sets how much capacity can connect through a quota.

Investors in core activities of a special economic zone can get a corporate tax holiday under Finance Ministry Regulation 130 of 2020. It runs 10 years for Rp 100 billion of investment, 15 years for Rp 500 billion and 20 years for Rp 1 trillion. Officials said the scheme was available to 31 December 2025.

The Finance Ministry said the tax holiday continues in 2026 through a new regulation. Relief will only bring the rate down to the 15 percent global minimum tax, against a normal 22 percent rate.

Indonesia applies a 15 percent global minimum tax from tax year 2025 under Finance Ministry Regulation 136 of 2024. Large groups with an effective rate below 15 percent pay a top up tax, which reduces the value of tax holidays.

Data centre investors in Nongsa Digital Park can get VAT exemption, waived import duty and import income tax, and 50 to 100 percent cuts in Batam local taxes. Non fiscal perks include licensing through the zone administrator and long stay visas.

Komdigi proposed tax breaks for data centre providers and for customers importing equipment, plus simpler licensing. It also wants new sites spread beyond Jakarta and Batam.

Under PP 71/2019, public scope electronic system operators must manage, process and store their systems and data in Indonesia. Private scope operators may place systems abroad. PP 71/2019 replaced PP 82/2012.

In December 2023 the then communications minister said PP 71/2019 would not be revised. He said foreign companies are not required to put data centres in Indonesia.

Law 27 of 2022 on personal data protection was enacted on 17 October 2022. Breaches must be reported to affected people within 3 times 24 hours, and fines reach 2 percent of annual revenue.

Government Regulation 33 of 2026 sets the detailed rules for the personal data law and takes effect on 16 January 2027. Data may go abroad only where the destination has equal or higher protection, other safeguards apply, or the person consents. A data protection agency enforces it.

OJK regulation 11/POJK.03/2022, issued on 7 July 2022, requires banks to place systems in data centres and disaster recovery centres in Indonesia. Offshore placement needs prior approval from OJK, the financial regulator.

Bank Indonesia regulation 22/23/PBI/2020 requires domestic payment transactions to be processed in Indonesia. This covers initiation, authorisation, clearing and settlement. It took effect on 1 July 2021.

Indonesia covers data centre water use through general water permits and environmental impact assessments. There is no national efficiency benchmark specific to data centres, so projects are judged case by case.

BP Batam, the authority that runs Batam, named water security as one of five priorities for data centre growth. The others are competitive power prices, supply guarantees, faster infrastructure and joint utility planning.

BP Batam chief and Batam Mayor Amsakar Achmad said data centres that need large volumes of water must build their own seawater desalination (SWRO) plants instead of drawing on public reservoirs. The policy targets the Nongsa special economic zone and the Kabil industrial area. Planned desalination capacity is about 750 litres a second within two to three years, rising to about 1,000.

As of 2 October 2026 the government had not set electricity tariffs for October to December 2026. Third quarter rates apply until it does.

Parliament aims to pass the New and Renewable Energy bill (RUU EBET) in 2026, a legislator said on 14 August 2026. The bill is expected to set rules for power wheeling, where a buyer uses PLN's grid to take power from a private renewable plant. Disputes over power wheeling stopped the bill in September 2024.

On 22 September 2026 Energy Minister Bahlil Lahadalia offered data centre projects to investors with competitive power prices and easier permits. PLN serves 159 data centres that used 2,378 GWh.

On 1 October 2026 the think tank IESR urged dedicated data centre rules. It proposed closed loop cooling, PUE below 1.3 and renewable shares of 35 percent by 2030 and 50 percent by 2040. PUE measures total site power against IT power.

Komdigi is working with industry body IDPRO on a sustainable data centre standard covering power, connectivity and uptime. Komdigi said it is meant as a shared guide and will add no new regulation.

Telkom's data centre arm NeutraDC plans up to 1 GW of AI data centres with Danantara, the state investment fund, and PLN supplying power. Sites named include Batam, Greater Jakarta, Java and Manado.