Achieving a sustainable energy future in the Global South requires not only technological innovation but also a deep understanding of governance and socio-political dynamics. In Indonesia, local renewable energy initiatives (LEIs) are central to addressing rural energy poverty and climate goals, yet their implementation is shaped by multi-level governance complexity and entrenched power asymmetries. This study conducts a systematic literature review of 34 empirical articles (2000–2025), selected from Scopus and Web of Science using community energy and Indonesia keywords. The analysis is guided by Polycentric Governance and Political Ecology frameworks, examining institutions, coordination, adaptability, exclusion, and justice across intra-, inter-, and system-level scales. Findings show strong local leadership and collaboration, but also internal inequities, persistent power imbalances, and policy misalignment. Indigenous knowledge remains marginalized. The study highlights both opportunities and challenges in promoting just, inclusive energy transitions. It concludes with future research questions on participation, donor alignment, and transferability of Indonesia’s LEI experiences to other Global South contexts.