The Indonesian government is planning to build 33,000 more solar power generators for 33,000 households living in remote areas, an Energy and Mineral Resources Ministry official said.
Demand for solar power generators is currently rising, the ministry's director general of electricity and energy utilization J Purwono said on Thursday, refuting an allegation that the government's solar power development program had failed.
"The program is considered successful. A number of district heads and governors have asked for more solar power generators," he said.
Solar power generators with a capacity of 50 watts each were considered suitable for use in the country's remote villages, he said.
He said it was very easy for villagers to use solar power generators because their storage batteries only needed refilling once a year.
Solar power generators have an economic life of up to 20 years.
"So, as long as the sun still shines, they can be used," he said.
ELECTRICITY GENERATION
Indonesia has installed electrical generating capacity estimated at 21.4 gigawatts, with 87.0% coming from thermal (oil, gas, and coal) sources, 10.5% from hydropower, and 2.5% from geothermal. Prior to the Asian financial crisis, Indonesia had plans for a rapid expansion of power generation, based mainly on opening up Indonesia's power market to Independent Power Producers (IPPs). The crisis led to severe financial strains on state-utility Perusahaan Listrik Negara (PLN), which made it difficult to pay for all of the power for which it had signed contracts with IPPs. PLN has over $5 billion in debt, which has grown markedly in terms of local currency due to the decline in the value of the rupiah. The Indonesian government has been unwilling to take over the commercial debts of PLN.
Indonesia is facing an electricity supply crisis, with some observers predicting that PLN may be unable to take on any new customers by 2005. Intermittent blackouts are already an issue across Java. Demand for electrical power is expected to grow by approximately 10% per year for the next ten years. The majority of Indonesia's electricity generation is currently fueled by oil, but efforts are underway to shift generation to lower-cost coal and gas-powered facilities. Geothermal energy and hydropower are also being investigated.
In January 2003, the World Bank announced that it was planning to build three micro-hydropower plants in the Indonesian province of Papua (Irian Jaya). A feasibility study on all of the area's water sources has already been conducted by the Bank, and the results are being studied. By building these facilities, the World Bank hopes to improve services to the local population as well as to encourage development activities in the province.
In October 2003, the World Bank approved a $141 million loan to Indonesia for the purpose of improving the power sector on Java-Bali, which uses approximately 80% of Indonesia's power generation capacity. The project includes support for a corporate and financial restructuring plan for PLN and technical assistance for a restructuring program for state gas company, Perusahaan Gas Negara (PGN), that will provide for increased natural gas supplies for electricity generation. The restructuring plan requires that PLN must restructure two of its subsidiaries, PT Indonesia Power and PT Pembangkit Jawa Bali (PJB). The two together supply about 80% of the power supply for Java and Bali, according to reports.
Also in 2003, the government renegotiated 26 power plant projects with the IPPs. Of those, five projects will be assumed by the government, in cooperation with PLN and Pertamina. The government foresees inviting private investors to participate in some electricity generation development projects, according to the U.S. Embassy.
Competition for power generation will be open on the islands of Batam, Java, and Bali by 2007. In 2008, retail competition in the electricity market will begin under the terms of the nation's new electricity law, approved in September 2002. The law requires an end to PLN's monopoly on electricity distribution within five years, after which time private companies (both foreign and domestic) will be permitted to sell electricity directly to consumers. However, all companies will need to use PLN's existing transmission network.
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