Photo 1. ESI Indonesia Dissemination and Handover Event, marking the conclusion of the UK PACT Phase II programme.
Jakarta, 21 October 2026 — The ASEAN Centre for Energy (ACE) and BASE Foundation, as consortium partners under the UK Government's Partnership for Accelerating Climate Transitions (UK PACT) Phase II programme, hosted a high-level dissemination and handover event to mark the successful conclusion of an eighteen-month journey to develop the Energy Savings Insurance (ESI) mechanism in Indonesia. Held at Novotel Cikini, Jakarta, the event brought together senior representatives from the Ministry of Energy and Mineral Resources (EBTKE), the Otoritas Jasa Keuangan (OJK), insurance and banking sector partners, technical experts, ESCOs, and the broader development community to celebrate a series of landmark achievements that have laid the groundwork for a commercially viable ESI market in Indonesia.
Formally commenced in April 2025, the BASE–ACE consortium set out to develop a market-ready mechanism through which an insurance product underwrites the performance guarantee offered by an Energy Efficiency Technology Provider to its client, addressing the longstanding reluctance of facility owners and technology providers to commit to energy efficiency retrofits due to uncertainty over actual savings performance. Over the course of the programme, the consortium achieved remarkable progress across four interconnected fronts: the development of a standardised Energy Savings Performance Agreement (ESPA) adapted to Indonesian law; the creation of a Measurement and Verification (M&V) methodology covering ten categories of EE technologies; the formalisation of commitments from the insurance sector through Memoranda of Understanding; and the engagement of multiple banking institutions through MoUs and Letters of Intent — all with the active and sustained support of OJK.
Photo 2. Opening remarks by Eko Sudarmawan (top left), Coordinator of Energy Conservation Business Development, EBTKE; Giles Henley (top right), Head of Low Carbon Energy and Infrastructure, British Embassy Jakarta; and Retno Woelandari (bottom), Head of Insurance Development Products, OJK.
Eko Sudarmawan, Coordinator of Energy Conservation Business Development at the Directorate General of New, Renewable Energy and Energy Conservation (EBTKE), delivered opening remarks on behalf of Gigih Adi Utomo, Director of Energy Conservation at the Ministry of Energy and Mineral Resources. He underscored the Ministry's firm commitment to supporting innovative financing instruments such as ESI as essential enablers for accelerating energy efficiency implementation across Indonesia's industrial and building sectors. Noting that ESI bridges the longstanding financing gap experienced by technology providers and end users alike, he affirmed EBTKE's readiness to work alongside regulatory and financial partners to facilitate the product's deployment into the Indonesian market.
Giles Henley, Head of Low Carbon Energy and Infrastructure at the British Embassy Jakarta, conveyed the UK Government's deep appreciation for the dedication demonstrated by EBTKE, BASE Foundation, ACE, and all programme partners throughout the course of UK PACT Phase II. He highlighted that the ESI initiative exemplifies the kind of market-oriented, high-impact climate finance innovation that the UK is proud to champion through its international climate action commitments, and underscored that the programme is a tangible reflection of the enduring UK–Indonesia partnership in support of Indonesia's energy transition and NDC ambitions.
Retno Woelandari, Head of Insurance Development Products at OJK, affirmed the regulator's strong institutional backing for ESI throughout its development. She described the mechanism as one of the most compelling examples of an innovative financing product in Indonesia's sustainability sector — one with the genuine potential to be a game changer for active participation by financial institutions in energy efficiency financing. She noted that OJK has been engaged as a key partner from the programme's earliest stages and remains fully committed to the process of formalising a regulatory pathway for ESI product approval.
The event marked a milestone eighteen months in the making: the formal handover of programme outputs — contractual instruments, technical methodologies, regulatory engagement outcomes, and private sector commitments — to EBTKE.
Photo 3. Handover ESPA and Methodology from British Embassy Jakarta to EBTKE (left) and MoU signing ceremony between BASE/ACE and Hijau Selaras to Pilot ESI project (right)
The morning plenary featured a structured presentation of the UK PACT Phase II programme results, guiding participants through the core market challenge the programme sought to address and the ecosystem of enabling tools now in place.
Photo 4. Explanation of ESI mechanism by Dan Valeriz, ACE (left) and Banyu Biru, ADCO Law (right)
Against the backdrop of persistent financing barriers in Indonesia's energy efficiency market, the BASE–ACE consortium presented the four foundational instruments developed over the course of the programme. First, the Energy Savings Performance Agreement (ESPA) — developed in partnership with ADCO Law and calibrated to Indonesia's civil contract framework — provides a standardised legal instrument governing performance guarantees between Technology Providers and clients. Second, the M&V Methodology — developed in close collaboration with BBSP KEBTKE — establishes technically credible procedures for measuring, verifying, and reporting energy savings across ten categories of EE technology, adapted from the international IPMVP standard. Third, Memoranda of Understanding with Indonesian insurance companies formalise the sector's readiness to underwrite ESI products. Fourth, signed MoUs and Letters of Intent from banking institutions mark the first concrete steps toward integrating ESI as a risk mitigation tool in energy efficiency project financing.
Attendees engaged actively throughout the morning session, contributing to lively discussions on the practical process for ESPA deployment, the structure of insurance product pricing under ESI, and the entry points for banking institutions seeking to participate in the emerging ESI ecosystem.
Photo 5. Afternoon M&V panel moderated by Dan Valeriz (top left), ACE, with panellists Agung Feinnudin (top right), BBSP KEBTKE; Yuriadi Kusuma (bottom left), Energy Expert; and Dr Nina Konitat (bottom right), BRIN.
The afternoon session, moderated by Dan Valeriz from ACE, convened a technical expert panel to examine the state of Measurement and Verification (M&V) practice in Indonesia and its role as a critical pillar of the ESI mechanism. M&V is fundamental to ESI: it provides the technical evidence base through which insurance claims are validated and energy savings guarantees are verified, underpinning the financial credibility of the entire product.
Agung Feinnudin from the Balai Besar Survei dan Pengujian (BBSP) KEBTKE — the national institution responsible for survey and testing in the energy and mineral sectors — opened the panel by describing BBSP's institutional engagement in developing the ESI M&V methodology. He outlined the process of translating international M&V options from the IPMVP standard into practical, technology-specific protocols suited to Indonesian project conditions, and highlighted BBSP's role as a technically credible anchor for M&V capacity in Indonesia.
Yuriadi Kusuma, an independent energy expert with extensive field experience in energy efficiency auditing across Indonesia's industrial and commercial sectors, offered a practitioner's perspective on M&V execution on the ground. He stressed that measurement costs and procedures cannot be standardised in a one-size-fits-all manner: costs vary significantly from site to site, depending on the size of the facility, the scope of the retrofit, the instrumentation already in place, and the specific terms agreed upon between the facility owner and the technology supplier.
Dr Nina Konitat from the National Research and Innovation Agency (BRIN) contributed a research-grounded perspective on energy measurement, addressing the importance of robust baseline data, the role of rigorous measurement protocols in supporting policy credibility, and the opportunity for BRIN to contribute to building national M&V capacity through applied research and institutional collaboration.
The panel discussion produced a key convergence on the design of the ESI validation function. Panellists agreed that within the ESI framework, the role of the Validation Entity — the independent body that reviews M&V outputs — can be appropriately limited to a desk review function, conducted on the basis of measurements carried out by the Technology Provider in the field. This design choice carries a significant practical implication: by bounding the validation entity's scope to desk review, the associated validation cost becomes not only affordable but highly predictable — calculable on the basis of consultant man-days rather than on-site instrumentation and field visits. This finding directly addresses one of the most frequently raised practical concerns among market stakeholders — that M&V and validation costs could render ESI economically unviable for small and medium-scale projects — and opens the path to broad commercial deployment.
The path ahead turns on one critical regulatory step. The ESI product currently awaits formal approval from OJK — a process that the regulator has actively supported for the past eighteen months and that participants are optimistic will be concluded in the near term. Once OJK approval is issued, pilot projects already identified and positioned by the consortium stand ready for immediate launch, translating the programme's frameworks into real-world performance contracts, insurance coverage, and verified energy savings.
ACE reaffirmed its full institutional commitment to carry the ESI initiative forward beyond the conclusion of UK PACT Phase II, in close coordination with BASE Foundation and in partnership with Indonesia's regulatory and private sector stakeholders. The organisation expressed its resolve not only to oversee and support the pilot phase but to actively pursue scale-up and replication of the ESI model across ASEAN — consistent with ACE's regional mandate to advance energy efficiency cooperation and financing innovation among Member States.
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About the UK PACT Phase II — ESI Indonesia Programme
Under the UK Government's Partnership for Accelerating Climate Transitions (UK PACT) Phase II, the BASE Foundation and ASEAN Centre for Energy (ACE) implemented an eighteen-month programme commencing April 2025 to develop and mainstream the Energy Savings Insurance (ESI) mechanism in Indonesia. ESI is a tripartite performance insurance mechanism through which an insurance company underwrites the energy savings performance guarantee provided by a Technology Provider to its client in an energy efficiencyproject. The programme has produced a comprehensive ecosystem of enabling tools — a standardised Energy Savings Performance Agreement (ESPA), a ten-technology M&V Methodology, active regulatory engagement with OJK and EBTKE, and formalised commitments from insurance and banking sector partners — establishing the foundation for a market launch upon receipt of OJK product approval.
