Waste-to-energy (WtE) incineration is a feasible way to respond to both the municipal solid waste management and renewable energy challenges, but few studies have been carried out on its environmental and economic impact in fast-developing southeastern Asian countries. To fill such a research gap, this study innovatively conducted a holistic assessment of WtE incineration application potential in Java Island, Indonesia. Here, we have established a life cycle assessment model for WtE incineration in Java, and have estimated the environmental impact, electricity generation potential, and techno-economic feasibility of implementing incineration by 2025. We have revealed that global warming potential, terrestrial ecotoxicity potential, eutrophication potential, and acidification potential are the major environmental impacts stemming from incineration activities. Moreover, we have estimated that promoting incineration in Java could reduce CO2 emissions by 41% on average. The electricity generated from incineration could contribute to 3.72% of Indonesia’s renewable energy target for the electricity grid mix by 2025. The cumulative energy production potential from incineration is estimated to reach 2,316,523 MWh/year in 2025 and will increase by 14.3% in 2050. The techno-economic assessment of incineration implementation in Java cities has been enumerated as feasible. The levelized cost of electricity from incineration (0.044 USD/kWh) is competitive with the current Indonesian electricity price (0.069 USD/kWh). Policies of minimizing incineration pollution, providing financial support guarantees, and overcoming social barriers have been proposed to facilitate the application of WtE incineration.