Indonesia High Voltage Cable Market Outlook to 2030

Indonesia High Voltage Cable Market Overview

• The Indonesia high voltage cable market reached a size of USD 968 million in 2023, driven by significant infrastructure developments, particularly in the energy sector. The growth is fueled by the government's continued investment in the expansion and modernization of the national grid, including new power plants and transmission lines.
• Key players in the Indonesia high voltage cable market include PT Voksel Electric Tbk, PT Sumi Indo Kabel Tbk, PLN Enjiniring, Prysmian Group, and Nexans. These companies dominate due to their strong manufacturing capabilities, strategic partnerships with the government, and extensive distribution networks across the archipelago.
• Jakarta, Surabaya, and Medan are the dominant cities in the high voltage cable market, driven by their rapid urbanization and industrialization. Jakarta, as the capital city, has the highest electricity demand due to its dense population and concentration of industries. Surabaya and Medan follow due to their strategic positions as industrial hubs in East Java and North Sumatra, respectively.
• In 2023, PT PLN (Persero) launched a new 500 kV transmission line project connecting the Java and Bali grids, significantly boosting demand for high voltage cables. The project, worth IDR 3.2 trillion, is expected to be completed by mid-2024 and aims to improve power distribution efficiency between these two critical regions. This development underscores the increasing role of high voltage cables in supporting the nation's growing energy infrastructure.

Indonesia High Voltage Cable Market Segmentation

The Indonesia High Voltage Cable Market can be segmented based on several factors:

• By Installation Type: The Indonesia high voltage cable market is segmented by installation type into overhead, underground, and submarine cables. In 2023, overhead cables dominated the market due to their lower installation costs and ease of maintenance. Overhead cables are extensively used in rural and semi-urban areas, where land availability is less of a constraint. This dominance is supported by the extensive grid expansion projects aimed at electrifying remote regions.

• By Voltage Level: The Indonesia High Voltage Cable Market is also segmented by voltage level into 35-110 kV, 110-220 kV, and above 220 kV cables. In 2023, the 110-220 kV dominated the market, driven by its widespread use in urban transmission networks. These cables are essential for connecting power plants to the grid and distributing electricity within cities. The ongoing urban development and expansion of industrial zones in Indonesia have reinforced the demand for 110-220 kV cables.

• By Region: the market is segmented into North, South, East, and West Indonesia. In 2023, West region dominated the market. This region's dominance is attributed to the concentration of the population, economic activities, and infrastructure projects, particularly in Java, which hosts the majority of Indonesia's industrial zones and urban centers. The region's well-established energy infrastructure further supports the demand for high voltage cables.

Indonesia High Voltage Cable Market Competitive Landscape

• PT Sumi Indo Kabel Tbk: In March 2024, PT Sumi Indo Kabel Tbk announced the expansion of its manufacturing facility in Bogor, with an investment of IDR 800 billion. The expansion is aimed at increasing production capacity to meet the growing demand for high voltage cables, particularly for renewable energy projects. The new facility will be operational by Q3 2024, contributing to the company's market leadership in Indonesia .
• PT Voksel Electric Tbk: In June 2023, PT Voksel Electric Tbk secured a contract worth IDR 1.5 trillion to supply high voltage cables for a new transmission line project in Sumatra. This project is part of the Sumatra-Java interconnection plan, which aims to improve electricity distribution between the islands. The contract includes the supply of 220 kV cables and is expected to be completed by the end of 2024.

Indonesia High Voltage Cable Market Analysis

Indonesia High Voltage Cable Market Growth Drivers:

• Renewable Energy Expansion: The Indonesian government's commitment to achieving 23% renewable energy in its energy mix by 2025 has spurred numerous solar and wind power projects, directly driving the demand for high voltage cables. In 2024 alone, the government has initiated 10 major renewable energy projects, each requiring substantial high voltage cabling for grid integration.
• Increasing Electricity Demand: The rapid industrialization and urbanization in Indonesia are leading to a significant rise in electricity consumption. As more industries emerge and urban areas expand, the demand for reliable and efficient power transmission increases, driving the need for high voltage cables to support this infrastructure growth
• Government Initiatives for Renewable Energy: Indonesia's commitment to increasing the share of renewable energy in its energy mixtargeting 23% by 2025has spurred numerous renewable energy projects. These projects require extensive high voltage cabling for grid integration, thus boosting market demand for high voltage cables as the country transitions to cleaner energy sources

Indonesia High Voltage Cable Market Challenges:

• High Costs of Raw Materials: The cost of raw materials, particularly copper and aluminum, which are essential for manufacturing high voltage cables, has seen significant fluctuations. This price volatility directly impacts the production costs of high voltage cables, squeezing the profit margins of manufacturers in Indonesia. The reliance on imported raw materials further exacerbates the issue, as currency fluctuations add to the overall production costs, making it a significant challenge for the market.
• Logistical and Distribution Challenges Across the Archipelago: Indonesia's vast and diverse geography presents significant logistical challenges for the distribution of high voltage cables, particularly to remote islands and rural areas. The cost of transportation accounted for nearly 20% of the total production cost of high voltage cables, due to the need for specialized vehicles and handling equipment.

Indonesia High Voltage Cable Market Government Initiatives:

• National Electricity Master Plan (RUPTL) 2021-2030: The Indonesian governments "National Electricity Master Plan" (RUPTL) launched in 2021, continues to be a cornerstone for the countrys electricity and infrastructure development. By 2024, the plan targets the installation of over 2,500 km of new high voltage transmission lines, necessitating a substantial increase in the production and deployment of high voltage cables.
• One Million Rooftops Solar Initiative (2023-2025): In 2023, the government introduced the "One Million Rooftops Solar Initiative" aimed at adding 1 GW of solar capacity by 2025. This initiative involves widespread installation of solar panels across residential, commercial, and industrial buildings. High voltage cables are essential for connecting these distributed solar generation units to the national grid.

Indonesia High Voltage Cable Market Future Outlook

The Indonesia high voltage cable market is expected to witness robust growth through 2028, driven by continued investments in energy infrastructure and the expansion of renewable energy projects. The government's focus on upgrading the national grid and integrating renewable sources will further enhance demand.

Future Market Trends:

• Integration of Smart Grid Technology: The future of the Indonesia high voltage cable market will be increasingly intertwined with the development of smart grid technology. By 2028, the widespread adoption of smart grids is expected to drive the demand for high voltage cables that can support advanced grid management systems.
• Expansion of Submarine Cables for Inter-Island Connectivity: With Indonesias geographical diversity, the expansion of submarine cables will play a significant role in improving inter-island connectivity. Future trends indicate that by 2028, there will be substantial investments in submarine cable projects, particularly to connect remote and underdeveloped regions to the national grid.