The World Bank’s Board of Executive Directors has approved a USD 150 million loan for Indonesia to scale up investments in geothermal Energy by reducing the risks of early-stage exploration. The loan is accompanied by USD 127.5 million in grants from the Green Climate Fund and the Clean Technology Fund.
Under the Indonesia Geothermal Resource Risk Mitigation (GREM) project, the financing will help public and private sector developers to mitigate risks in exploration of geothermal resources, including covering a part of the cost in case of unsuccessful exploration. The project will also finance technical assistance and capacity building of key stakeholders in the geothermal sector.
Geothermal Energy is expected to play a significant role in reducing Indonesia’s greenhouse gas emissions. As a clean and renewable Energy source, geothermal can reduce the country’s dependence on coal-fired power and other fossil fuels. Indonesia now has 1.9 gigawatts of installed geothermal power and plans to develop an additional 4.6 gigawatts to help meet the government’s target of renewable Energy.
This year, the Directorate General of New and Renewable Energy and Energy Conservation (EBTKE) of the Ministry of Energy and Mineral Resources (ESDM) prepared three exploration drilling programs in three Geothermal Working Areas (WKP). The locations are Waesano (East Nusa Tenggara), Jailolo (North Maluku) and Nage (East Nusa Tenggara).
(Sources: Think GeoEnergy; Power Technology; The World Bank)