Share
Financing remains a structural obstacle in harnessing Indonesia’s community-based solar PV ambitions. Of Indonesia’s 100 GW Solar PV ambition, 80 GW is allocated to community-scale installations, yet the capital available does not match the risks these projects carry. Lestari Advisors officially launched its report on Islamic blended finance for community-based solar PV at an online dissemination event on 25 September 2026. The event brought together government, Islamic finance institutions, waqf organizations, and community renewable energy initiatives to discuss the proposed framework.
The report proposes a lifecycle approach, in which each project stage is financed by the Islamic financing instruments best suited to its risk. Koperasi Desa Merah Putih (KDMP) provides a platform to manage decentralized village solar assets. Cash waqf can supply initial capital, building on Indonesia’s experience with Cash Waqf Linked Sukuk (CWLS). Furthermore, existing Sharia contracts have the ability to be adapted into the financing structure. The scheme’s success depends on clear roles, structured monitoring and evaluation, and adequate stakeholder capacity.
Panelists considered the scheme practical and focused on how it can serve village economies. Eka J.R. Firmansyah, Deputy Director of Islamic Finance Inclusion at the National Committee for Sharia Economy and Finance (KNEKS), noted that the framework relies on Sharia contracts and institutions that are already in place. Rayan Asa Luminaries, Director of Wakaf Al-Azhar, pointed out that waqf is flexible in its beneficiaries, which allows it to reach village initiatives with limited access to finance. Roysepta Abimanyu, Expert Staff at the Ministry of Cooperatives, argued that solar planning should start from the productive equipment it will power, such as cold storage and electric boats.
Several conditions must still be met before the scheme can scale. Islamic banks need to be convinced, and nazhir (waqf managers) need stronger capacity to manage funds as investments. A pipeline of solar projects must be developed alongside the funding pipeline, and electricity tariffs must stay within what communities can pay. Lestari Advisors remains committed to supporting Islamic finance for productive assets in Indonesia’s sustainable transition.
Read the Event Summary here. The webinar recording can be accessed on YouTube: