Indonesia has a waste problem. Does China have a solution?

By Hasya Nindita and Zhaoyin Feng

Chinese waste-to-energy company Zhejiang Jinneng Electric Power Technology Co., Ltd. (浙能锦江环境控股有限公司) held a groundbreaking ceremony in Palembang, a major city in Sumatra, Indonesia, in September 2024. Amid the crackling of firecrackers and fireworks, the first foundation pile of a waste-to-energy (WTE) plant was driven into the ground.

Last year, the Chinese company signed a power purchase agreement with Indonesia's state-owned electricity company Perusahaan Listrik Negara (PT PLN). Jinneng plans to build a system of incinerators and turbines in Palembang that is designed to process 1,000 tons of solid waste per day. The process captures heat from incinerating waste materials, which drives a turbine to generate electricity. As outlined in the agreement, PLN will purchase the energy generated.

Wiluyo Kusdwiharto, Director of Project Management and New Renewable Energy of PLN, said at the ceremony that the Palembang Project would not only address the serious issue of mounting waste in the city, but also help reduce greenhouse gas emissions and generate “green electricity,” according to Jinneng's press release.

During Indonesia's rainy season (roughly October–April each year), Palembang City regularly experiences severe flooding.

Marlina Sylvia, Head of Water Resources Division of the Public Works and Spatial Planning Department of Palembang City, added that this project would help with the flooding problem in Palembang due to piles of garbage that cause clogged drainage systems. It is estimated that around 90 tons of waste are dumped into rivers in a single day in Palembang. 

Sylvia told Kompas, a prominent local newspaper:

As one of the industry leaders in China, Jinneng currently runs 27 WTE facilities across the country. The Palembang project will be the company’s first overseas WTE plant. Jinneng states that the project will:

WTE projects seem to offer a twofold benefit, as they eliminate accumulating waste while generating electricity as a byproduct. Is China’s waste-to-energy technology a solution for the growing waste problem in Indonesia and Southeast Asia? Or is it too good to be true? 

China: From boom to overcapacity 

In the last two decades, the waste-to-energy incineration industry has developed rapidly in China, especially in medium and large cities. According to data from China’s Ministry of Housing and Urban-Rural Development, between 2005 and 2023, the proportion of urban domestic waste treated by incineration rose from 9.8 percent to 82.5 percent, and the number of waste incineration plants grew from merely 67 to 1,010. The country is now a global leader in waste-to-energy technology, particularly for municipal solid waste.

While the WTE sector has become part of the solution for China’s waste problem, a new challenge has emerged — overcapacity. 

In an interview with China News Weekly, Pan Gong, a solid waste industry analyst of the Chinese environmental think tank E20 Institute, said.

According to Pan, around 2018, China saw a boom in the construction of waste-to-energy incineration plants. By 2022, when these incinerators started to operate, the issue of incineration plants being “underfed” gradually began to emerge.

Due to the overcapacity problem and fierce domestic competition, Chinese waste incineration companies, such as Jinneng, started to look overseas. Southeast Asia, as a region with a high concentration of developing countries, high economic and population growth, significant demand for waste-to-energy incineration projects, and in close proximity to China, has become a key overseas market for Chinese waste-to-energy companies.

Indonesia's waste crisis

Indonesia's size, rapid pace of urban development, and accelerating waste challenge make it a promising destination for WTE investment. Producing over 65 million tons of waste per year and growing, the country faces a significant waste management crisis. In addition, for decades, the archipelago had been importing waste from places such as the EU, Australia, and the US, exacerbating its domestic waste problems.

Starting in the 1990s, China became the world's largest hub for international waste imports. Officials tightened regulations about waste imports in 2011 and stopped this practice altogether at the start of 2018, recognizing the unsustainability, environmental toll, and health impacts on local populations. As a result, many Western countries then turned to lower-income countries in the Global South to solve their waste problems, even as many of these countries had underdeveloped waste management systems. Some activists have termed this practice “waste colonialism.”

By 2022, Indonesia had become the world's third-largest trash importer, bringing in a whopping 262,900 tons of plastic waste in 2024. The practice was officially banned in January 2025, with Minister of Environment Hanif Faisol Nurrofiq noting: “I would like to remind all parties that there will be no more imports of plastic waste from next year. We have had enough, as this country continues to struggle with managing its significant volume of such waste.”

Waste in cities is managed using conventional and unsustainable methods, mainly open dumping, which leads to a significant level of methane emissions, a major contributor to global warming. 

The waste management rate in various regions of Indonesia has only reached around 10 percent, with landfills across the country projected to reach maximum capacity by 2030.

The vast amount of unmanaged and untreated waste has polluted the environment, said the country’s Deputy Environment Minister Diaz Hendropriyono. In an interview with Antaranews, he said: “The impact is far-reaching. We have found microplastics in rivers, water sources, placentas, and even breast milk.”

However, the dire situation also presents an opportunity for Indonesia’s waste-to-energy processing sector. Indonesia currently has only two WTE facilities operating in Surabaya, East Java, and Solo, Central Java. The government is aiming to increase the number to 30 by 2029. 

The sector has attracted strong interest from foreign investors, not only from China, but also from Singapore, Japan, and Europe, according to Indonesia’s Coordinating Minister for Food Affairs Zulkifli Hasan in an interview with the Indonesian News Agency: “This is a business that many find attractive because it is both feasible and profitable.” The government has vowed to streamline regulations to clear the path for potential foreign investors. 

Challenges ahead 

While Waste-to-energy technology can turn the waste crisis into renewable energy, it comes with unique challenges from economic, environmental, and social perspectives.

Researchers found that electricity feed-in tariffs and tipping fees at WTE facilities are currently inadequate in Indonesia to make these facilities commercially viable. Furthermore, the waste in Indonesia tends to have high moisture content, which requires pre-processing and increases the overall cost for waste processing. Priyanto Rohmatullah, Director of Environmental Affairs at the Ministry of National Development Planning (Bappenas), explained the challenges Indonesia faces in converting waste to energy at an environmental symposium at Universitas Gadjah Mada.

Environmental NGO Indonesian Forum for the Environment (Wahana Lingkungan Hidup, WALHI) expressed similar concerns. Yuliusman, the Executive Director of WALHI South Sumatra, stressed the importance of proper upstream waste management before WTE operations begin. He highlighted that “facilities and infrastructure for household waste collection” must be in place to support the WTE effectively.

WTE plants have been a controversial subject around the world due to concerns about environmental and health impacts, especially surrounding the emissions of polychlorinated dibenzodioxins (PCDDs), dibenzofurans (PCDFs), and other pollutants. For example, in China, the past decade has witnessed several large-scale protests by residents living near WTE facilities, expressing concerns about their potential negative impacts.

Social opposition to WTE incineration is currently limited in Indonesia, as the industry is in an elementary phase, but public concerns will likely increase as the market in Indonesia grows. As waste-to-energy technology has greatly improved in the past decade, there is now a broad scientific consensus that sophisticated and advanced WTE facilities can be a financially viable, safe, and environmentally friendly option for generating electricity. Transparency of environmental and health data will be crucial to addressing public opposition. [GlobalVoices/VP]

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