RI to resolve stalled power project following pressure from Japan

Indonesia?s Coordinating Minister for the Economy Hatta Radjasa said that the government would expedite a resolution to the land acquisition problem hampering the development of a giant power plant project in Batang Regency, Central Java.

Hatta made this statement on Tuesday, as reported by The Jakarta Post.com following a Japanese-Indonesia bilateral meeting on the sidelines of the APEC gathering in Bali.

Japanese Prime Minister Shinzo Abe, speaking at the APEC meeting on Monday, dedicated about a fifth of his speech on the Japanese-funded Batang 2,000 MW power plant project and its benefits to Indonesia, urging the Indonesian government to quickly resolve the stalled development of the project.

PT Bhimasena Power Indonesia, a consortium of several Japanese conglomerates ? J-Power Electric Power Development Co. Ltd., Itochu Corporation ? and Indonesian coal mining company PT Adaro Energy, priced the project at US$4 billion. The power plant would use Ultra Super Critical Generation Technology to reduce pollution.

The consortium was supposed to start the construction of the project in 2012, but was delayed due to protests from environmental groups. Last week, J-Power said that deadline was pushed back again to October 2014 as land acquisition process has yet to be completed, causing the consortium to be unable to make financial closing for the project.

With a capacity of 2,000 megawatts, the project would become Southeast Asia?s biggest power plant by capacity, and a leading example of a public-private partnership (PPP), which has been touted as a solution to the infrastructure shortfall in Indonesia.

Abe disagreed with environmental groups that argued the Batang power plant would generate dirty emissions and was no different to conventional coal-fired power plants.

The Batang power plant would use the so-called Ultra Super Critical Generation technology that burned coal at a high temperature, something that would make ?great progress? in the APEC economies? fight against climate change, he noted.

?Japan?s technology will converge with the local knowledge that Indonesia?s Adaro Energy possesses,? said Abe. ?My message to you is the following: When considering the mounting need for infrastructure and urban development in your countries, always remember you have Japan.? (*)