Indonesia's coal-fired power plant in Central Java to be operated by 2016

Indonesia expected to operate a coal-fired power plant in Central Java valued at 3 billion U.S. dollars by 2016 following recent enactment of a presidential decree and a finance ministerial decree about law umbrella on infrastructure projects guarantee conducted by government and private sector, a press statement said here on Monday.

Bambang Dwiyanto, public relation manager of PT Perusahaan Listrik Negara (PLN), state-run power company, told reporters that the decrees will allow PLN to resume tender process of the power plant in line with schedule. "Hopefully, a power purchase agreement contract between PLN and independent power projects (IPP) could be signed in the middle of this year so that the coal-fired power plant of Central Java could operate by 2016," said Dwiyanto in a statement.

He said that the power plant would be constructed to anticipate high demand rate of electricity of 8-9 percent per year to support national economic growth of 6-7 percent per year.

Besides, he said, currently, Indonesia has low electrification ratio of 58 percent in 2006 and 65 percent in 2010 whereas the government's target is 91 percent by 2019.

"Limitation of PLN's financial capability in investing at the power sector highly demands private sector participation. Therefore, the construction of the coal-fired power plant of Central Java would be conducted by IPP who will be also responsible to finance the project," said Dwiyanto.

PLN has conducted pre-qualification tender on Nov. 2009 and seven foreign investors have met the qualifications, namely Mitsubishi, Consortium of GDF Sueza J-Power, Consortium of International Power and Mitsui, as well as Marubeni, among others.

Source:Xinhua