PLN set to sign 58 PPAs for renewable projects
Monday, July 31 2017 - 12:52 AM WIB
State-owned electricity firm PT PLN is expected to sign on Wednesday power purchase agreements (PPAs) for the development of 58 renewable-based power plant projects with combined capacity of more than 350 MW, Bisnis Indonesia reported on Monday.
The paper quoted Minister of Energy and Mineral Resources Ignasius Jonan as saying that the 58 renewable projects were part of 62 renewable projects proposed by the government
He said that the signing of the PPAs is proof that the renewable power plant projects are considered by the developers to be economically feasible despite the recent introduction of new Ministerial Regulation No 12/2017, which limits the tariff of electricity from renewable power plants sold to PLN at 85 percent of the PLN regional electricity supply cost (or BPP).
Some industry players have previously complained that the tariff limit would make renewable power plant projects unfeasible, and thus discourages investment in the renewables sector. They said that only projects located in regions with BPP higher than national average will be feasible particularly in the eastern part of the country where the regional BPP is still quite high.
President Joko Widodo has previously criticized Jonan for issuing certain regulations which are seen to discourage new investment in the energy and mining sectors. (*)