Indonesia's Electricity Projects- Multi-Client Studies

Comprehensive Report

INDONESIA ELECTRICITY GENERATION PROJECTS IN 2006–2015

May 2007

The electricity production in 2006 was at 128,423 GWh, produced largely by coal (54,659 GWh) then by oil (28,009 GWh), by natural gas (27,063 GWh), hydropower (12,153 GWh) and by geothermal (6,539 GWh). Biofuels is now being considered the most important opportunity to help oil while nuclear power is still being planned to be built in 2009.Image

The increasing role of coal indicated by fastly rising electric energy production generated coal from 45,473 GWh in 2005 and to 270,383 GWh in 2025. The next most important primary energy in the electricity industry to replace oil is natural gas. The government has estimated that the electric energy produced by gas fired power plant will increase from 35,427 GWh in 2005 and 146,978 GWH in 2025.

The energy sales in 2005 – 2025 is projected to increase by more than 4.6 times from 98 TWh in 2005, to 145 TWh in 2010, to 223 TWh in 2015, to 320 TWh in 2020 and 448 TWh in 2025. In Java – Bali, it would be 4.40 times and in the outer island would be about 5.2 times. Existing installed capacity of 18,058 MW is considered not enough to cope with rising demand. Therefore, PLN has prepared plan to increase the installed capacity by 2,915 MW in 2006, then to be raised every year at increasing rate and will amount to 21,115 MW in 2025.

Privatization (IPP) is the only war rescue the degrading electricity condition in Indonesia, basically because the rising demand cannot be coped by PLN’s existing capacity of energy production, transmission and distribution facilities. If all 27 IPP completed and operational they would contribute a total of 10,935 MW additional capacity to the country’s electricity.

There are priority project that requires a total investment of US$ 5.2 billion or around US$ 1.0 billion per year. It is said that funding is expected to come from private sector amounting to US$ 3.8 billion and the remaining US$ 1.2 billion will be paid by PLN from bilateral and multilateral basin, or from expert credit and commercial loan.

To complete the construction of additional capacity including power plants, transmission and distribution facilities as well as rural electrification project which are programmed from 2006–2025, PLN has set a plan to invest US$ 139,470 million for electricity development in 2006 – 2025, including US$ 125,631 million only for power generation plant. Funding for transmission and sub–station would be US$ 8,741 million and for distribution and transformer facilities would be US$ 5,097 million.

These are just part of investment required by Indonesia which are described in our report regarding additional projects to be completed in 2006 – 2025 in order to supply significant electric energy for Indonesia. This particular report contains more information with regard to the additional capacity to be built which are important to all parties interested in electricity in Indonesia.