Local communities to benefit from geothermal royalties in Indonesia

Patuha geothermal plant, Bandung, Indonesia (source: ESMAP)
Alexander Richter 5 Aug 2016

With a regulation signed into force today, local communities in Indonesia will benefit from geothermal production bonuses calculated on the basis of gross income from the sale of geothermal.

Having reported on plans for new regulations on royalties payments for local communities from geothermal operations in Indonesia, the government has now issued the regulation.  The Regulation No. 28/ 2016 on geothermal production bonuses and its procedures was signed today by President Joko Widodo.

The regulation states that the production bonus is a financial obligation of the holder of a permit for a geothermal project and the company that operates the project. This obligation also applies to geothermal energy business joint operating contracts and geothermal energy business permit holders.

The bonus is calculated based on gross income from the sale of the geothermal energy or electricity sales from the geothermal power plant. “Geothermal permit holders are obliged to provide a Production Bonus from the time the first unit starts producing commercially,” says Article 2 paragraph (1) of this regulation.

It will – so local news – amount to one percent of the gross income from the sale of geothermal energy, or 0.5 percent of the gross income from the sale of electricity derived from geothermal power plants.

Further details via the link below.

Source: KataData