Home » Posts tagged 'jakarta post'
Tag Archives: jakarta post
Indonesia state owned PLN under pressure to expedite contract agreements with smaller independent power producers – Andalas Energy & Power
The government’s 35,000 megawatt (MW) electricity procurement program has continued to show sluggish progress, as development contracts for half the targeted capacity have yet to be completed more than a year after the launch of the flagship program.
The ambitious program, with a completion target of 2019, will require the construction of 219 power plants and 737 transmission facilities consisting of 75,000 towers, 1,375 main stations, 2,600 transformers using 300,000 kilometers of aluminium cable.
The program is expected to help increase the national electrification ratio to 97 percent by 2019, up from the current ratio of 88.3 percent.
However, the latest data presented by state-owned electricity firm PLN shows that as of September, only 232 MW of the total 36,722 MW targeted to be procured had reached its commercial operating date, or was already in operation.
Furthermore, PLN still needed to wrap up 17,984 MW worth of development contracts for power plants to get the program moving.
Up to 11,729 MW comprises power purchase agreements (PPA), while the remainder are PLN’s engineering, procurement and construction (EPC) contracts.
Even so, the state-owned firm has only targeted the completion of 14,069 MW worth of development contracts, with PPA’s making up the majority of the contracts targeted.
PLN president director Sofyan Basir noted that there were several setbacks in the wrapping up of development contracts because of the recent revision of PLN’s electricity procurement business plan (RUPTL) for 2016-2025.
“We have had to rearrange the positions of several power plants of our EPC. However, we will try to make up for it by expediting contract agreements for both EPC and IPP [independent power producers] of smaller projects in the outer regions,” he said during a hearing with the House of Representatives Commission VII overseeing energy on Thursday.
PLN also wrapped up on Thursday the contract tender for the Jawa I steam-fueled power plant project. The project, which will result in two power plants with a capacity of 800 MW each, was won by a consortium made up of state-owned oil and gas company Pertamina, Japan’s diversified group Marubeni Corp. and Sojitz Corp.
An estimated investment of US$2 billion will be needed for the construction of Jawa I, which is expected to start operating by 2019.
Despite the setback, the government is positive that the targeted contracts will be wrapped up by the end of the year. The Energy and Mineral Resources Ministry’s electricity development program director, Alihuddin Sitompul, said the government had learned its lesson and had given PLN full authority over the contract auctions and the ability to directly appoint IPPs for renewable energy, mouth-mine and marginal gas power plants.
PLN may also be hinging its success on mobile power plants (MPPs), which make up around 4,000 MW of the project, as they can also be assigned through direct appointments and take less than six months to be operational.
Full story here
Indonesia state firms told to triple investment to help stoke growth – Andalas Energy (ADL)
State firms told to triple investment to help stoke growth
by Viriya P. Singgih, Jakarta Post
State-owned companies are expected to triple their investment value in the next two years to reach Rp 895 trillion (US$68.02 billion) in 2018 in support of President Joko “Jokowi” Widodo’s 6 percent economic growth target.
State-Owned Enterprises (SOE) Minister Rini M. Soemarno said the President had urged all state firms to gradually increase their investment value from Rp 285 trillion this year to Rp 450 trillion in 2017 and Rp 895 trillion in 2018.
“It is part of the president’s plan to see 6 percent economic growth by 2018,” Rini said on Thursday, adding that most of the state firms’ investments would be related to infrastructure projects, including toll roads, public houses and electric power houses.
In meeting the target, the government has stressed once again the importance of establishing state-owned holding companies. It has planned to form six holding companies for the oil and gas, mining, food, banking and financial services, and construction and public housing sectors, with the aim of boosting their value, debt leverage and efficiency.
Therefore, those holding companies are expected to be financially independent and even give significant contributions to the state budget so that the government can expedite national development further.
Indonesia will need Rp 5.5 quadrillion for its infrastructure projects from 2014 to 2019, of which 19 percent is expected to be funded by state firms, 40 percent by the state budget, 10 percent by the regional state budget and the remaining 31 percent by the private sector, according to data from the National Development Planning Agency (Bappenas).
The infrastructure projects that will be done in the government’s priority include 2,6000 kilometers of new roads, 49 new dams and 35,000 megawatts (MW) of power plant procurement during President Jokowi’s tenure.
State electricity firm PLN, which is crucial to Jokowi’s electricity supply target, has even planned an 80,000 MW electricity procurement program until 2025, as it calculates electricity supply outside Java will grow exponentially.
“It is in accordance with the spirit of the Nawacita [nine goals] program under President Jokowi’s administration that aims to decentralize national development,” PLN corporate planning director Nicke Widyawati said.
Moreover, Maritime Affairs and Fisheries Minister Susi Pudjiastuti said the country needed to boost the development of infrastructure needed for sea toll roads, including cold storages, so that it could pave the way for integrated logistics services in the future.
She claimed that Russian company Blackspace planned to invest $200 million for the development of 12 to 15 cold storages across the country, while the Indonesian government would inject Rp 1.5 trillion for the project.
Meanwhile, Jokowi has also recently launched the One Fuel Price policy, which aims to make the price of fuel the same in all regions across the country, including Papua and Kalimantan.
The new policy, which is expected to run effectively by year-end, will force state-run oil and gas firm Pertamina to allocate Rp 800 billion in subsidies every year.
“That’s why state firms need to maintain their positive performance, because sometimes they have to make sacrifices in the interest of the people,” Rini said.
Full article here
Revolving blackouts loom as power shortages worsen across Indonesia – Jakarta Post
On September 2nd 2015, CEB Resources updated the market, saying it had agreed with PT Akar Golindo (PTAG) to assess the technical and commercial opportunities for monetising gas in and around the Tuba Obi East oil and gas concession in the South Sumatran Basin. The studies investigated both the potential to sell the gas directly to the Singapore market, the Duri steam-flood project, or other buyers via the major transmission gas pipeline, about 12 kilometres away. Alternatively there is the opportunity to monetise the gas via the construction and operation of an independent power plant, selling electricity into the Sumatran power grid.
CEB sees the gas and power market in Indonesia as an opportunity that should form part of its long-term balanced asset portfolio. Importantly the gas price is independent of the oil price. This was demonstrated in January this year when a Sumatran gas project secured a long-term gas sales contract at US$ 9.45 per Million British Thermal Units (MMBTU), which is amongst the highest gas prices in the world. Similarly, the demand for electricity continues to rise sharply with the country’s electricity provider PLN setting the ambitious goal of increasing supply by some 35,000 MW over the next 4 years. With only 9,000 MW having been firmed up thus far, CEB believes that investment in this sector is particularly attractive.
Yesterday an article was published in the Jakarta Post warning that revolving blackouts are likely given the power shortages that exist – again highlighting the market potential. Alihuddin Sitompul, director at the Energy & Mineral Resources directorate general for Electricity said, “We are currently pushing our power plants to the limits of their operation in order to catch up with growing demand.” He added, “We have to rest some of the plants, yet that simply means supply will become a nagging concern.”
Full article below:
