Mulyagusdin

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Imagine a factory in Aceh signing a long-term power purchase contract with a solar plant. On paper, it looks like a simple deal: the factory needs electricity, the plant has electricity, and the price is agreed upfront. But the moment the accounting team tries to record it, a far less simple question comes up. The sun does not shine with the same intensity every day. Sometimes the electricity generated exceeds what the factory can use, and the surplus has to be sold back into the market. The question is whether this contract can still be recorded as an ordinary purchase contract, or whether it must be treated as a financial instrument whose value moves with the market and hits the profit and loss statement directly.

This is not an academic question. It is a real problem that led the International Accounting Standards Board (IASB) to issue two amendments at once to IFRS 9 (Financial Instruments) and IFRS 7 (Financial Instruments: Disclosures) throughout 2024. In Indonesia, both were adopted by the Financial Accounting Standards Board of the Indonesian Institute of Accountants (DSAK IAI) as Amendments to PSAK 109 and PSAK 107: two numbers now deliberately matched to their original IFRS numbers, the result of IAI's renumbering so that Indonesian and international standards are easier to line up. Both take effect for reporting periods beginning on 1 January 2026. That means corporates whose financial statements close in December already have to operate under this new rule this year. These amendments target two instruments increasingly used by renewable energy corporates, namely Power Purchase Agreements and ESG-Loans: long-term electricity purchase contracts abbreviated as PPAs, and sustainability-linked loans whose interest rates are tied to ESG target achievement.

Two Amendments: Power Purchase Agreement and ESG-Loan

The first governs the classification and measurement of financial instruments in general: its final status is already certain, ratified by DSAK IAI on 16 December 2024. The second, more specific, governs electricity contracts whose source depends on nature: solar, wind, and hydro power. This draft amendment was approved for circulation on 19 March 2025, and its public comment period closed in July of the same year. I deliberately separate the two here because one is already final and binding, while the other is still in process. This difference in status matters if your company is starting to prepare its recording system now.

Both were born from the IASB's post-implementation review of IFRS 9. The two issues practitioners complained about most: how to record electricity purchased from renewable energy plants, and how to classify loans whose interest rates are tied to environmental-social-governance (ESG) performance. Two issues that sound technical, but touch directly on two things growing fast in Indonesia: the energy transition and green financing.

Solar Power Is Complicated to Record

Until now, commodity purchase-sale contracts, including electricity, have generally been excluded from financial instrument accounting as long as their purpose is purely for own use. The principle makes sense: if you buy electricity to power a factory, that is an operational matter, not market speculation, so it does not need to be fair-valued at the end of every period like a derivative.

The problem arises once the electricity source depends on the weather. Wind or solar power plants cannot control their output to match the buyer's demand schedule. Sometimes production exceeds demand, and electricity market design usually requires the surplus to be sold on the spot market within a certain time: not a choice, but a technical necessity. Technically, this resale can be read as evidence that the contract is "not purely for own use," which means the contract must be treated as a derivative and its fair value hits the profit and loss statement every period. Yet economically, the buyer is still a net purchaser of electricity, not a trader of it.

This amendment answers that with the net purchaser concept. As long as the entity buys electricity in a quantity sufficient to offset the surplus it is forced to resell, assessed over a reasonable period of up to twelve months, the own-use exception can still apply. The contract is recorded as an ordinary executory contract, not a derivative that swings through the profit and loss statement.

The second issue lies in hedge accounting. The old rule required the hedged amount to be fixed at a set volume. Yet anyone who has managed a renewable energy project knows production volume shifts with the weather: there is no fixed number that can be promised. The official DSAK IAI document gives a fairly clear example: a manufacturing company enters into a virtual power purchase agreement with a wind plant to lock in a price per megawatt-hour. Under the old rule, this company had to designate the hedged volume at a fixed figure lower than its own expected usage, or discontinue the hedging relationship before the contract ended. Both options made the financial statements fail to reflect the risk management strategy actually being carried out.

This amendment allows entities to designate a variable nominal amount as the hedged item, aligned with the electricity volume expected to be delivered by the referenced plant. In simple terms: accounting finally follows how renewable energy actually works, not the other way around.

The closest example is right here in Aceh. The floating solar plant project being proposed at Paya Seunara Reservoir, Sabang, which I previously wrote about in “Kanvas di Atas Air”, is exactly the type of plant this amendment targets: its source depends on the weather, its volume cannot be guaranteed fixed. If that project actually goes ahead and starts selling its electricity through long-term contracts to PLN or local industry, the questions above are no longer an academic exercise, but a real accounting decision that the finance teams on both sides of the contract will have to make.

The geothermal potential of Seulawah Agam, which I discussed in “Neraca yang Terlewat”, with a target of 55 megawatts starting operation around 2032, has a production profile far more stable than solar or wind, so it does not automatically fall within the scope of this electricity contract amendment. But a project of that scale still needs large-scale financing, and that is where the green loan amendment discussed in the next section becomes relevant. These two energy projects, together with the commodity export story via Malahayati Port that I wrote about in “Neraca yang Belum Ditulis”, is in fact the same picture: Aceh's balance sheet is changing faster than we can prepare the accounting language to record it.

ESG-Loan and What's Often Misunderstood

The second amendment targets something closer to the banker's desk: loans whose interest rate is tied to ESG targets, commonly called a sustainability-linked loan. A typical example: the interest rate drops by 0.1 percent if the borrower succeeds in cutting its carbon emissions in line with an agreed target.

A financial instrument that is to be recorded at amortized cost rather than fair value must pass the contractual cash flow test, commonly abbreviated among accountants as the SPPI test: whether its cash flows are solely payments of principal and interest. The ESG feature hanging off the interest rate had raised doubts, because technically it is a variable outside the credit risk and time value of money normally used for this test. If it fails the test, the loan must be measured at fair value through profit or loss. The consequence: the borrower's financial statements become more volatile simply because there is a sustainability clause in the contract, something counterproductive for encouraging more green lending.

This amendment confirms that ESG-based interest rate adjustments can still pass the SPPI test, as long as the adjustment reflects reasonable compensation for a change in credit risk or borrowing cost, rather than creating a return disproportionate to the underlying loan.

This is where I need to be clear about something easily misunderstood. This amendment is not a standard for measuring or certifying a corporation's success in cutting emissions. What it regulates is purely accounting classification: whether a loan may be recorded in a simpler, more stable way. Its practical effect does smooth the path for green financing, because banks and corporates become more comfortable issuing or taking on ESG-clause loans without odd recording risks.

But whether the emissions target is actually achieved and how that is disclosed to the public is the domain of sustainability disclosure standards like IFRS S2 or the Sustainability Disclosure Standards roadmap IAI is currently preparing: different standard, different purpose. Conflating the two, as though passing the SPPI test means a company has "passed" environmentally, is a framing mistake I often see, and one that anyone writing or reading about this should avoid.

There is one other technical clarification, smaller but practical: entities may now elect an accounting policy to derecognize a liability settled through an electronic payment system before the actual settlement date, provided certain conditions are met and applied consistently to all transactions through the same system. This answers a gap many finance teams have long felt: the transfer instruction has already been sent and cannot be canceled, yet the funds only actually move a few days later.

One Is Already Final, One Is Still in Progress

This is what I think corporates in Aceh and Indonesia in general need to pay attention to. The classification and measurement amendment has been final and binding since December 2024: there is no room to wait. Meanwhile the renewable energy electricity contract amendment, which is actually most relevant for regions with solar, hydro, and wind potential like Aceh, is still in the process of being finalized at DSAK IAI as of mid this year, even though the proposed effective date is likewise 1 January 2026.

The gap between now and that effective date is down to just a few months. For corporates just starting to explore green financing or renewable electricity purchase contracts, including business operators and investors in Aceh eyeing small-to-medium scale renewable energy projects, the preparation window has already narrowed. Finance teams need to start mapping out PPA contracts currently running or planned, testing whether those contracts meet the net purchaser criteria, and discussing with auditors how hedging strategies will be restructured under the new rules. Waiting until the standard is truly final is not a wise strategy, because new recording systems and contracts usually need far longer to adjust than the standard's own ratification process takes.

A company's balance sheet, in the end, does need to follow wherever energy and financing move. What changes in 2026 is not the underlying spirit, but that there is finally an accounting language precise enough to correctly record Power Purchase Agreements and ESG-Loans.

Tulisan ini sengaja saya batasi pada gambaran besar dan implikasinya. Untuk pembaca yang butuh detail teknis lebih jauh, saya sudah menyiapkan panduan terpisah yang membahas langkah demi langkah bagaimana membaca, mengakui, mengukur, dan mencatat kedua amendemen ini dalam laporan keuangan, mulai dari pengujian pembeli neto sampai jurnal untuk hubungan lindung nilai dengan volume variabel. Ditujukan untuk mahasiswa akuntansi dan praktisi yang perlu pegangan lebih rinci dari sekadar opini.

Sources and References

1. IFRS Foundation, “IASB updates IFRS Accounting Standards for nature-dependent electricity contracts”, 18 Desember 2024. ifrs.org
2. IFRS Foundation, “IASB issues narrow-scope amendments to classification and measurement requirements for financial instruments”, Mei 2024. ifrs.org
3. RSM UK, “Understanding the IASB’s Amendments to IFRS 9 and IFRS 7”. rsmuk.com
4. Ikatan Akuntan Indonesia, “Pengesahan Amendemen PSAK 109 dan PSAK 107 tentang Klasifikasi dan Pengukuran Instrumen Keuangan”, 16 Desember 2024. iaiglobal.or.id
5. Ikatan Akuntan Indonesia, draf eksposur amendemen PSAK 109 dan PSAK 107 tentang kontrak yang mengacu pada listrik bergantung pada alam, disahkan pada 19 Maret 2025. DE PDF
6. Ikatan Akuntan Indonesia, “Telah Terbit DSAK Terkini Edisi Desember 2025”, 30 Januari 2026. iaiglobal.or.id