Summary of Key Points from the Conference Call on Indonesia's Waste-to-Energy Market Industry Overview - The conference discusses the waste-to-energy (WTE) market in Indonesia, particularly focusing on the impact of the new presidential decree issued in November 2025, which significantly alters the revenue model for waste incineration projects [1][2][4]. Core Insights and Arguments - **Revenue Model Changes**: The new presidential decree shifts the revenue model from relying on tipping fees and grid connection prices to a fixed electricity price of $0.2 per kWh, simplifying the income structure and enhancing investor return expectations [1][4][5]. - **Increased Project Viability**: The decree addresses issues from the previous 2018 presidential decree, which failed due to problems with waste processing fees and collection systems. The new model allows for a 30-year fixed electricity price, significantly improving internal rates of return for projects [1][4][5]. - **No Capacity Limits**: The new policy removes capacity limits, allowing for increased operational hours and fuel calorific value, which can lead to higher electricity generation and revenue [1][6]. - **Government Involvement**: Local sovereign funds are involved in projects to ensure government revenue and provide backing, enhancing project stability and credibility [1][8]. - **Investment Costs**: Hardware equipment constitutes about 70% of the total investment cost, with an example cost of approximately 500 million RMB for a project processing 1,000 tons of waste, translating to about 500,000 RMB per ton [1][9][10]. Additional Important Points - **Challenges in Waste Collection**: The previous projects faced challenges in waste collection frequency and matching with electricity load. The new decree allows project owners to negotiate directly with local governments for waste supply, which is a significant advantage [5][7]. - **Carbon Revenue and Ash Reuse**: The new policy introduces carbon revenue and ash reuse as additional profit sources, which can enhance project economics [3][4]. - **Competitive Landscape**: Chinese companies have a technological and pricing advantage in the Indonesian market, particularly in core equipment like grate furnaces. Companies with proprietary technology, such as Kangheng and Chongqing Sanfeng, are better positioned to compete [2][3][17][24]. - **Operational Cost Dynamics**: The operational costs and revenues are easier to calculate under the new framework, as the government has quantified most variables. However, uncertainties remain regarding future policy changes [18]. - **Market Development Pace**: The pace of project development may slow down as the government waits for the first batch of projects to stabilize before launching subsequent rounds of bidding [23]. Conclusion - The new presidential decree is expected to create a more favorable environment for the waste-to-energy industry in Indonesia, attracting more investors and facilitating the growth of this sector. The involvement of local governments and sovereign funds, along with the removal of capacity limits, positions the industry for potential success in addressing waste management challenges in the region [1][4][8][19].