Can I set the power indicator to show battery percentage instead of time remaining?

Matthew Paul Thomas, an interface designer for Canonical's Ubuntu team, in his blog comments this April wrote "I think the only point in showing a percentage charge is so that a human can get an idea of how much time is left. But we have computers to do those sort of calculations now. If a battery’s estimated time remaining is wrong, its percentage will be even less informative."

There is also a comment on the Ubuntu wiki that says "This coloring is deliberately time-based, not percentage-based; how much time you have left is more important than how long the battery can theoretically last."

You can install the Battery-Stats applet, which will replace the Power-Managers's applet with more information and some power-management options as a bonus.

sudo apt-get install battery-stats
battery-stats-collector

Then see /var/log/battery-stats for sample information.

I don't think the indicator shows that information yet.

You can click on the menu entry which says "X hours YY minutes left to (dis)charge" and it will open the battery profile dialog. That one has percentages under "Laptop Battery -> Details (scroll to bottom)"