Government of Indonesia preparing development incentives for geothermal energy

Government of Indonesia preparing development incentives for geothermal energy Lumut Balai geothermal plant, Indonesia (source: WIKA)
Alexander Richter 14 Aug 2019

The government of Indonesia is working on the preparation of incentives to help geothermal energy to be competitive for Indonesia, so the so that geothermal prices can be competitive,

The government is preparing incentives for the development of geothermal energy for the electricity sector. Currently the price is still expensive, causing the development of geothermal energy to appear slow. The Director General of New and Renewable Energy and Energy Conservation (EBTKE), FX Sutijastoto of the Ministry of Energy and Mineral Resources (ESDM) said geothermal was a sector of concern for the Minister of Finance Sri Mulyani.

He said at that time Sri Mulyani requested detailed studies on geothermal energy based on references to the application of geothermal energy in various countries such as New Zealand, the Philippines and the United States.

“The government will try to prepare incentives so that geothermal prices can be competitive,” Toto said at the 7th Indonesia international Geothermal Conference at the Jakarta Convention Center, Senayan, Jakarta, Tuesday, August 13, 2019.

These incentives, said Toto, can be given in various types, one of which is through the reimbursement system. For example building a geothermal power plant (PLTP) is financed in advance by the developer but later reimbursed by the government.

“Now we will strive for these strategies so that the potential for geothermal development,” said Toto. On the same occasion, Chairman of the Indonesian Geothermal Association Prijandaru Effendi said geothermal development was indeed hampered by economic prices that were not in accordance with the capabilities of PT PLN (Persero). But he said geothermal was a viable alternative to replace fossil energy which was expected to be depleted. Moreover, the use of geothermal energy is considered easier than other energy. He gave an example when there was a blackout or blackout last week, one of which was suspected because of the length of the generator to enter the system.

While geothermal power plants can enter the gridline first because it does not require too long of a cold start. This energy only takes two to three hours to enter the grid.

Furthermore, Prijandaru said he was confident that the development of geothermal energy could be carried out. Mainly to pursue a new renewable energy mix policy of 23 percent in 2025. “2025 is indeed too optimistic, but we must force it as much as possible to pursue the target. How will be the results? We will see in 2025,” said Prijandaru.

Previously Vice President Jusuf Kalla (JK) quipped the development of the use of geothermal as electrical energy in the homeland was slow. JK said that geothermal is not a new product for Indonesia, even the use of geothermal in Kamojang has been operating for 35 years. “Geothermal is not new, although there have been seven conferences but progress (geothermal utilization) is slow, the result is 2,000 MW.” JK said.

Source: Medcom