PIP allocates Rp 3.4 trillion for renewable energy

Pusat Investasi Pemerintah (PIP), the government investment unit under the Finance Ministry, has prepared about Rp 3.4 trillion to finance renewable energy projects such as hydro and geothermal power plants, Bisnis Indonesia reported on Friday.

PIP?s head Soritaon Siregar said in Jakarta on Wednesday that about Rp 1.4 trillion would be allocated to finance micro hydro power plants and Rp 2 trillion to finance geothermal exploration.

?Up to now, we have received three loan proposals for micro hydro power plants worth Rp 600 billion. We also have signed power purchase agreements (PPAs) with PLN,? he said.

In the energy sector, PIP focuses on providing loans to micro hydro power plants with a capacity of below 10 MW, and geothermal exploration. Due to the lack of experience, at present PIP cooperates with PLN in providing loans in power plant projects.

?The loan will be disbursed after PPAs are signed. We and PLN jointly carry out a feasibility study of the projects,? he added.

Meanwhile, PLN?s President Director Nur Pamudji said he hoped local financial organizations would also provide loans to renewable energy projects. At present, most of the fundings for projects came from foreign organizations. PLN has, for example, received loans from the World Bank to finance large hydro power plants such as PLTA Upper Cisokan which has a capacity of 4 x 260 MW. (*)