The Indonesian Directorate General of Renewable Energy and Energy Conservation (EBTKE), a department under the Ministry of Energy and Mineral Resources (EDSM), is planning to auction five Geothermal Working Areas (WKP) with a development potential of 725 MW. Planned for auction in July 2019, the WKPs include Sembalun in West Nusa Tenggara with a potential of 100 MW, Telaga Ranu in North Malaku at 85 MW, Gunung Wilis (East Java) and Gunung Galunggung (West Java). Pertamina (PGE), a state-owned enterprise will operate the Kotamobago working area.
Separately, PGE has completed the exploration process in Hululais in Bengkulu province where it will provide geothermal steam for a plant to be constructed by PT PLN (Persero).
The Hululais Geothermal Power Plant (PLTP), targeted to be operational in 2021, has a capacity of 55 MW. The exploration investment totaled an estimated USD 165 million, while the construction of plants was expected to be USD 110 million.
Indonesia had around 2 gigawatts of geothermal capacity in operation as of the end of 2018. Fitch Solutions expects Indonesia’s total geothermal generation to witness average growth of 9.2% year-on-year between 2019 and 2022. Fitch highlights supportive regulations to encourage investment in the geothermal sector but also identifis risks including artificially low government-regulated electricity tariffs, which restrict potential returns on investment; the government’s local content requirements and a preference for local firms in the tendering process, and the availability of conventional low-cost Energy sources, such as coal.
(Sources: ThinkgeoEnergy.com; Business Times)