Go to Indonesia, get into solar power—truly profitable!

Indonesia is Southeast Asia's largest economy, yet its annual per capita electricity consumption stands at only 1.32 MWh—far lower than that of other major countries in the region. As the world's largest archipelagic nation, comprising tens of thousands of islands, this poses a significant challenge for centralized grid-based power supply. At the same time, however, it also creates vast opportunities for distributed photovoltaic microgrids.

Simply put, the market has enormous potential, but its current level of development remains low—it's currently in the early stages of accelerated growth.

But a domestic company with a keen eye has already set up an extensive photovoltaic "web" across Indonesia. This company also delivered strong performance in its recent H1 results.

On August 21, Hornding Dongci released its 2025 semi-annual report. In the first half of the year, the company achieved revenues of RMB 11.936 billion, representing a year-on-year growth of 24.75%; net profit attributable to shareholders reached RMB 1.020 billion, up 58.94% from the same period last year. Both revenue and profit continued to grow rapidly.

Hengdian Dongci stated that the key reason is the photovoltaic industry's ability to maintain healthy profitability by leveraging its differentiated domestic and overseas production capacities and market strategies, as well as by actively contributing solutions for downstream applications.

According to analysis, the overseas production capacity mentioned should refer to the Indonesian photovoltaic market.

Indonesia's "Giftedness" in Photovoltaics

Indonesia, located near the equator, boasts abundant solar resources and is naturally well-suited for developing photovoltaic energy. Estimates suggest its solar energy potential ranges from 3,300 GW to 20,000 GW. Moreover, with a population of approximately 280 million and rapid economic growth, the country is experiencing steadily rising electricity demand. However, as an archipelagic nation, Indonesia faces challenges in fully extending its grid infrastructure to all islands and remote rural areas. In this context, distributed PV microgrids have emerged as a crucial solution to enhance access to reliable, equitable, and affordable electricity.

As the cost of photovoltaics continues to decline, its economic viability is becoming increasingly evident. According to IESR estimates, the levelized cost of electricity for solar-plus-storage systems over the next 25 years will be approximately $0.12–$0.15 per kWh—significantly lower than the cost of locally commonly used diesel power generation.

According to customs data, from January to May this year, China’s exports of solar cell wafers to Indonesia reached approximately 1.7 billion RMB, making the country the world’s second-largest exporter in this category. During the same period, China exported various key photovoltaic materials to Indonesia worth 366 million USD, compared to just 71.38 million USD during the same period last year. As a result, China’s photovoltaic exports to Indonesia surged by an impressive 413% year-on-year in the first five months of this year.

At the beginning of 2023, Hornding Dongci announced it would build a photovoltaic project in Indonesia, officially breaking ground in September of the same year. Production began in the second half of 2024, with capacity gradually ramping up over time.

Following the announcement of Indonesia's photovoltaic project, Hengdian Dongci's financial reports have continued to shine year after year. According to statistics, Hengdian Dongci’s net profit attributable to shareholders was 1.816 billion yuan in 2023, rose to 1.827 billion yuan in 2024, and reached 458 million yuan in the first quarter of 2025. Since 2022, Hengdian Dongci has consistently turned a profit.

 

In the first quarter of 2025, the Hengdian Dongci Indonesia battery base has nearly reached full production capacity, achieving quarterly battery sales of approximately 900 MW and contributing strong profitability to its photovoltaic business. It is anticipated that the Hengdian Dongci Indonesia facility will deliver shipments totaling over 3.5 GW in 2025.

It is well known that the United States has launched anti-dumping and countervailing duty investigations against four Southeast Asian countries, prompting Chinese photovoltaic companies to纷纷 choose new manufacturing bases. Among them, Hornding East Magnetic is leveraging its presence in Indonesia to sidestep the "double anti" measures and high tariffs, thereby gaining short-term cost advantages and enhancing market penetration.

Chinese enterprises "follow one after another"

Of course, it's not just Horndian Dongci—several Chinese companies have already established photovoltaic production capacities across various segments in Indonesia.

In the silicon wafer segment, Haijuxing has already initiated trial production of 6 GW, while Boda New Energy has already established relevant production capacity. In the battery segment, Longi Green Energy and Haitai New Energy have already made corresponding arrangements, and photovoltaic production facilities in Indonesia owned by companies such as Hornding Dongci, Tianhe Solar Energy, and Shangde Power have already begun operations. Additionally, three companies have already started production in the module segment.

Specifically:

"Quick-profit" production capacity

But don’t get ahead of yourself—trade tensions have escalated across the board, and global tariffs are now everywhere. As a result, Chinese photovoltaic companies’ overseas production capacity, especially those targeting the U.S. market—whether in Indonesia, India, or even Turkey, Egypt, Oman, and other regions—could very well face significant challenges.

These third countries may soon become indistinguishable from the four Southeast Asian nations—after all, there will always be established players in the U.S. photovoltaic market, such as First Solar and Hanwha Q CELLS, continuously filing complaints. As a result, the U.S. Department of Commerce’s “double anti-dumping” investigations will not only grow more efficient but also increase in frequency over time.

Analyzing Indonesia's highly profitable production capacity over the past year or two. On July 15, 2025, the U.S. reached a trade agreement with Indonesia, ultimately imposing a 19% tariff on Indonesian export products—lower than the initially proposed 32%. While this has eased some of the tariff pressures, Indonesia will still face higher costs and increased trade uncertainty. Moreover, future tariffs could potentially rise further or even expand to cover additional product categories, depending on how U.S.-Indonesia negotiations evolve in the coming months.

Hengdian Dongci relies on its Indonesian layout to bypass China's "double anti-dumping" measures and high tariffs on its products, thereby gaining short-term cost advantages and enhancing market penetration. However, although the U.S.'s "reciprocal tariffs" have been temporarily put on hold, they still pose significant long-term policy risks. The U.S. side retains the flexibility to adjust its tariff strategy toward Indonesia at any time—once Indonesia loses its status as a "safe haven," Hengdian Dongci's profitability advantage at its overseas factories will quickly erode. By extension, similar scenarios are likely to unfold in India, Turkey, and Egypt as well.

Indonesia's photovoltaic market certainly brims with opportunities, but the trade environment has always been unpredictable. Although the U.S. has temporarily shown leniency toward Indonesia, in the long run, the "double anti-dumping" sword still hangs ominously overhead, and policy risks remain unresolved. For Chinese companies venturing overseas to set up factories, it’s no longer just about seizing market share—it’s increasingly a survival strategy aimed at navigating the growing fragmentation of global trade. Photovoltaic globalization has now moved beyond simply "manufacturing for export" and entered the "strategic deep waters."