Completion of Batang power plant pushed back to 2018
Saturday, April 26 2014 - 04:24 AM WIB
The schedule for the completion of the 2x1,000 MW coal-fired Batang power plant in Central Java has been pushed back to 2018 due to lingering land acquisition problem, according to a senior minister.
Coordinating Minister for the Economy Hatta Rajasa told reporters Friday that out of the 226 hectares of land requirement for the mega project, about 29 ha has yet to be acquired.
Hatta said that due to this obstacle, the completion of the power plant has been delayed to 2018 from the initial schedule of 2016. He, however, remains hopeful that financial closure for the project could be made in October of this year.
He stressed that the US$4 billion power plant project, dubbed to be the largest in Southeast Asia, is crucial to help avoid future electricity crisis in Java as it will supply about 30 percent of electricity consumption in the country?s most populated island.
The Batang power plant will be built by PT Bhimasena Power Indonesia, a consortium comprising Jakarta listed coal giant PT Adaro Energy Tbk, and Japan?s J-Power Energy Power Development Co. Ltd. and Itochu Corp. The power plant will sell electricity it produces to state-owned electricity company PT PLN under a 25-year-contract.
Aside from land acquisition issue, there has also been protest from local residents and environmentalists over serious environmental impact of the project.
Meanwhile, National Land Agency (BPN) head Hendarman Supandji was quoted by The Jakarta Post as saying Thursday that the government would revise the presidential regulation on land acquisition for public development to speed up the land acquisition process, which had hampered the construction of many infrastructure projects.
The land agency said that the planned revision would ease land-acquisition procedures so that the purchase of land up to 5 hectares could be directly carried out with land owners. Under the current regulation, land acquisitions of more than I hectare are required to pass through several stages under the supervision of a special committee.
Speaking separately, Adaro president director Garibaldi Thohir said land acquisition was currently a big stumbling block.
?We can pay them now, however, no one wants to sell the land. This project has enormous benefits as it will provide electricity to industry. which can provide jobs. Moreover, we cannot see it delayed anymore because Java and l3ali would suffer if the project cannot go ahead,? Garibaldi said.
Garibaldi said that he expected the planned revision of the presidential regulation regarding would accelerate the land acquisition process. If the regulation is revised, land acquisitions could he completed by the year end, Garibaldi said as quoted by The Post.
Indonesia needs additional power-generating capacity of an average 5,700 MW per year to meet growing demand, which is rising by around 8 to 9 percent per year, according to the Energy and Mineral Resources Ministry.
As part of an attempt to anticipate the electricity crisis should Batang could not be able to deliver power by 2018, state-owned power firm PLN is planning to accelerate works on several other power plants, according to the company?s planning director Murtaqi Syamsuddin as quoted by The Post. The power plants to be accelerated, according to Murtaqi, are plants in Grati in East Java as well as Priok and Muara Karang in Jakarta.
Editing by Reiner Simanjuntak