BOOT scheme in biogas power project may be revised

The Ministry of Energy and Mineral Resources may revise the current build, own, operate, and transfer (BOOT) scheme in biogas power plant projects as it would be quite difficult to implement, Bisnis Indonesia reported on Monday.

Under Minister of Energy and Mineral Resources Regulation No 50/2017 on the development of renewable-based power plants, independent power producers are required to transfer the power plants to state-owned electricity firm PT PLN after their 30-year power purchase agreement (PPA) with the state utility expires. New renewable power plant projects have applied the BOOT scheme.

Deputy Minister of Energy and Mineral Resources Arcandra Tahar during a visit on Friday to the Jangkang 1.8 MW biogas power plant in Bangka Belitung Province, which has been in operation since 2013 by PT Austindo Aufwind New Energy, a subsidiary of IDX-listed palm oil producer PT Austindo Nusantara Jaya Tbk, he was asked by company officials about the implementation of the BOOT scheme in biogas power project.

Implementing the BOOT scheme in a project such as Jangkang will be quite difficult as the biogas power plant is located in the oil palm plantation area of Austindo. Transferring the palm oil are to PLN would disrupt the supply of oil palm bunches and palm oil mill effluent for the power plant.

?I was asked about the BOOT scheme. I?ve just realized (it?s difficult to implement the scheme in project such as Jangkang), ? he told the paper, adding that the ministry will evaluate the BOOT scheme policy. He did not provide further details.

The application of the BOOT scheme and the policy limiting electricity tariff from renewable power plants at 85 percent of the regional electricity supply cost (BPP) of PLN have been seen as among of the discouraging factors for new private investment in renewable projects in the country. (*)