Govt says second 10,000-MW power projects to cost $20 billion

State electricity company PT Perusahaan Listrik Negara (PLN) and independent power producers (IPPs) will need between US$16 billion and $20 billion to finance the construction of power plants to be built under the second 10,000-megawatt power development program.

J. Purwono, the Director General of Electricity at the Energy and Mineral Resources Ministry, said in Jakarta on Tuesday that PLN and IPPs would respectively build 50 percent of the power plants to be built under the plan.

He said that PLN and IPPs were still waiting for the issuance of the Presidential Decree to begin the second 10,000-megawatt power development program in which about 2,616 megawatt of the power supply to be generated from coal-fired power plants, 1,440 megawatt from gas-fired power plants, 4,733 megawatt from geothermal power plants and 1,174 from hydro power plants.

Purwono said that the ministry had proposed an issuance of the government?s guarantee to encourage private investors to provide the funding for the power projects. ?We are still waiting for the response,? he added.

Meanwhile PLN?s President Director Fahmi Mochtar said that PLN alone would need between $8 billion and $10 billion for the construction of the power plants it would build under the second 10,000 megawatt program.

According to Fahmi, PLN will build around 60 percent of the project and the rest will build by IPPs.

Meanwhile, PLN Director for Planning Development Bambang Praptono said that the state electricity company had received commitment from international financial agencies such as World Bank, JBIC and other consortium. ?The financing for the project has been secured,? he said. (*)