Investment Rating of Renewable Energy in Indonesia: Assessing the Mini-hydro Power Plant Using Moody's Rating

The significance of renewable energy is growing due to several aspects, such as economic considerations, energy resilience, and environmental considerations. In conclusion, the significance of renewable energy is evident, and it is imperative that we continue to allocate resources and advance renewable energy sources to ensure a sustainable and dependable energy outlook. This research aims to identify the investment level of a mini hydro power plant project using Moody’s rating. This also aims to discover how investing in a mini hydro power plant, currently classified as “high risk”, can raise its notch rating or even become an “investment grade” category through Moody’s. Using a case study methodology, this research is qualitative. Purposive sampling was used to select participants for this study, and secondary data sources were used to collect data. The assessment is done by spreading the company’s financial reports for the last three years to obtain historical ratio values and balance sheet variables. In addition, industry/market, company, and management variables are also measured. The data for these variables is sourced from both internal and external sources of the Company, including financial reports, sales reports, annual reports, production reports, and other relevant paperwork. Based on the comprehensive input and analysis results, the assessment results were obtained as “Caa1”, which is included in the “High Risk” investment category. Several suggestions are given to increase companies’ notch rating or investment category to be “investment grade”.