PLN signs contract to buy electricity from Rajamandala power plant

State owned electricity company PT. Perusahaan Listrik Negara (PLN) has agreed to buy electricity from a hydropower plant which will be built in West Java by PT Rajamandala Electric Power (REP), a joint venture between PLN?s subsidiary PT Indonesia Power and Kansai Electric Power Inc of Japan.

Under the power purchase agreement which was signed in Jakarta on Tuesday by PLN president director Nur Pamudji andd REP executives Bambang Priyambodo dan Takashi Shimada, PLN agreed to buy electricity from Rajamandala for 8.66 US cent per kWh for 30 years.

Pamudji said that the signing of the purchase agreement reflected PLN?s commitment to further increase the power supply from hydropower plants. ?Rajamandala hydropower plant is the first electricity project in Indonesia which is guaranteed by the Multilateral Investment Guarantee Agency (MIGA)," he added, referring to the World Bank unit.

PLTA Rajamandala hydropower plant will be built in Citarum river in Cihea village, Haurwangi district, Cianjur West Java with capacity of 47 MW. The construction of the power plant will cost about US$115 million and will be financed by a Japanese bank under a project financing scheme. The power plant is scheduled for operation in 2016.

Editing by Reiner Simanjuntak