Indonesia to offer 33 hydropower project to investors

Indonesia to offer 33 hydropower project to investors

The Public Works and Public Housing Ministry will offer 33 hydroelectric power plant (PLTA) projects to potential investors next year, in a bid to further the use of the country's existing dams for power generators.

The ministry is currently assessing a total of 203 existing dams to ascertain their capacity and hydropower potential, water resources administration director Arie Setiadi Moerwanto said on Friday.

Of the country's existing 203 dams, only around 5 per cent have already been developed for use in power-generation.

"We are currently conducting a study to look at the potential of the existing dams to produce energy. We hope to have the study completed in December," Arie told reporters on Friday.

The dams with the most potential include Lodoyo, Karangkates III and Karangkates IV in Malang as well as Kesamben in Blitar, East Java, according to Arie.

The government is also currently drafting a presidential regulation to assign state-owned enterprises to construct PLTA at several existing dams.

Arie said that the government might support the projects through the viability gap fund (VGF) scheme, which allows the government to allocate state funds to cover up to 40 per cent of the total value of an infrastructure project using the public-private partnership (PPP) scheme.

"We are currently still discussing the scheme with all stakeholders: which dams are most feasible for investors, and regarding the VGF scheme to help finance the project," he said.

State electricity firm PLN's director for construction, Nasri Sebayang, meanwhile, said that the country's hydropower potential was around 75,000 megawatts (MW), yet only around 5,000 MW or seven per cent of the potential was utilized.

He argued that utilization of alternative energy sources through the development of hydropower was necessary to assist PLN in meeting the nation's electricity needs, projected to grow at an average of 9 per cent per year.

To support the government's food security programme, Public Works and Public Housing Minister Basuki Hadimuljono previously said that the ministry intended to construct 49 dams over the next five years, an increase from the previous target of 30 dams.

The total investment needed to develop water resources between 2015 and 2019 reaches Rp 400.5 trillion (S$42.6 billion), according to the National Development Planning Board (Bappenas).

The amount allocated by the state budget to the sector is around Rp 275.5 trillion, with the remaining Rp 68 trillion expected to come from regional administration budgets, state-owned enterprises and the private sector.

Hydropower plants are expected to be the biggest contributors to the government's plan to expand the country's renewable energy from 10.7 gigawatt (GW) to 21.5 GW by 2019. Hydropower plant capacity is expected to jump by more than 76 per cent to 13,393 megawatts (MW) by 2019 from the current output of 7,572.3 MW.

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