Jakarta, INTI - PT Pertamina Geothermal Energy Tbk (PGEO) is planning to expand its business portfolio into the data center sector, covering activities such as data processing, storage, and management. The initiative also includes the provision of computing infrastructure, hosting services, and supporting operations such as servers, networking, and other system components.
The company stated that this new business line is closely aligned with its core geothermal operations, where electricity generated from geothermal energy will be utilized to power data center facilities. This approach is intended to support the development of an integrated clean energy and digital infrastructure ecosystem.
“This plan is part of the company’s strategy to diversify its business while optimizing the use of geothermal energy,” management noted in a disclosure to the Indonesia Stock Exchange.
PGEO plans to seek shareholder approval for this initiative at its Annual General Meeting (AGM) held on April 21, 2026. The company also confirmed that, to date, there have been no objections from any parties that could hinder the proposed expansion.
Strong Growth Potential in Indonesia’s Data Center Market
PGEO highlighted that Indonesia’s data center market has experienced rapid expansion, particularly in 2025, driven by strong cloud adoption, the growth of artificial intelligence (AI) workloads, supportive regulations, and increasing investor interest in Southeast Asia’s digital economy.
Indonesia’s position as a regional data hub is further strengthened by the development of submarine cable systems connecting the country to multiple international networks, thereby enhancing global bandwidth capacity.
In 2025, Tier III data centers accounted for more than 61.59% of the market share in Indonesia, while Tier I and Tier II facilities are gradually becoming less relevant due to their inability to meet current requirements for uptime, redundancy, and security.
The expansion of digital services across sectors such as banking, fintech, e-commerce, telecommunications, cloud platforms, and government systems has also accelerated the shift toward Tier III and Tier IV data centers.
Between 2024 and 2031, Indonesia’s data center market, particularly in retail and wholesale colocation, has shown strong growth. Retail colocation capacity reached 388.11 MW in 2025 and is projected to increase to 1,623.91 MW by 2031, while wholesale colocation is expected to reach 1,275.93 MW.
This growth is largely driven by increasing digitalization among SMEs, startups, and cloud-native businesses, which prefer flexible, scalable, and cost-efficient hosting solutions.
Revenue from colocation services also continues to rise, increasing from USD 4.78 billion in 2024 to USD 5.89 billion in 2025. Overall, the market demonstrates strong sustainability and significant growth potential, supported by rising demand for digital infrastructure across industries.
Integrated Clean Energy-Powered Data Center Development
PGEO plans to develop a data center facility in Garut, covering an area of approximately 5,133 square meters. The project will be supported by a dedicated geothermal power plant (PLTP) with a capacity of 5 MW to supply clean energy directly to the data center.
The facility is designed to connect with at least two telecommunications network providers, with infrastructure already supported by networks from Telkom Indonesia and PLN Icon Plus.
The project is expected to require around 38 additional employees focused on operational activities. Based on an independent feasibility study, the plan has been deemed viable across market, technical, operational, and financial aspects.
Business Impact and Strategic Value
The expansion is expected to create added value for shareholders through revenue diversification, stronger business performance, and long-term growth potential. PGEO will primarily target corporate clients, including technology companies, digital service providers, and institutions requiring data center infrastructure.
While the investment will increase fixed assets and temporarily reduce short-term cash flow, it is projected to generate recurring income, improve operational efficiency through energy cost savings, and enhance profit margins.
Overall, the initiative is expected to have a positive impact on the company’s asset growth, revenue generation, and overall valuation, while maintaining manageable levels of liabilities.
As part of the Pertamina Group, PGEO may also collaborate with affiliated entities in areas such as energy supply, infrastructure development, engineering, procurement and construction (EPC), and IT support services.
Conclusion
PGEO’s planned expansion into the data center sector reflects a strategic convergence between clean energy and digital infrastructure. By leveraging its geothermal capabilities, the company is well-positioned to support the growing demand for sustainable, high-capacity data services. This move not only diversifies revenue streams but also strengthens Indonesia’s position in building an integrated, energy-efficient digital ecosystem.
Read more: From Singapore to Indonesia: A New Era for Data Center Growth in Southeast Asia