Developing Geothermal Energy, Govt Continues to Make Breakthroughs
MINISTRY OF ENERGY AND MINERAL RESOURCES
REPUBLIC INDONESIA
PRESS RELEASE
NUMBER: 268.Pers/04/SJI/2020
Date: 9 September 2020
Developing Geothermal Energy, Govt Continues to Make Breakthroughs
Geothermal energy forms of the backbone of Indonesia's energy supply in the future. With a potential of over 23.9 Gigawatt (GW), Indonesia is listed among world's countries with the largest geothermal potential. The country's National Energy Master Plan (RUEN) has targeted the installed capacity of geothermal power plants (PLTP) to reach 7,000 Megawatt (MW) in 2025. Additionally, the government continues to be committed to realizing the target of 23 percent new, renewable energy in the energy mix in 2025.
To accelerate the development of geothermal power plants, Minister of Energy and Mineral Resources (EMR) Arifin Tasrif said that the government has continued to make innovative breakthroughs by providing various facilities for geothermal contractors. The facilities include, among others, the issuance of Law Number 21 of 2014 on Geothermal Energy which sets out that geothermal power plants can be constructed in production, protected, and conservation forest areas.
"As set out in Law (Number 21 of 2014), construction of power plants can be done in production, protected, and conservation forest areas. In addition, we've requested geothermal contractors to perform community welfare and CSR (Corporate Social Responsibility) programs, and encourage regional governments to maximize the use of regional revenues from production bonus," said Arifin at Digital Indonesia International Geothermal Convention (DIIGC) 2020 held on Tuesday (8/9).
The government also promotes regional-based geothermal development, for example through Flores Geothermal Island (FGI) program. "This is to meet the electricity demands of Flores Island from geothermal energy and to optimize indirect utilization. This program will also be applied in other regions, after the FGI runs well," continued Arifin.
To attract geothermal investment, Arifin said that the government provides a number of fiscal incentives, for example, tax allowance and exemption from Land and Building Tax (PBB) as well as import duty.
Moreover, to reduce contractor's risks, the government has initiated a geothermal power plant development scheme in which the government carries out the exploration drilling. "The government provides a development scheme for power plants, in which the exploration activities are carried out by the government," he said.
Currently, the government is formulating a presidential regulation that will govern new prices for renewable energy. "This is done to attract investment in the renewables, including geothermal development," emphasized Arifin.
In line with the RUEN, the energy mix from renewables is targeted to reach 23% in 2025, with per capita energy consumption reaching 1.4 Ton of Oil Equivalent (ToE) and per capita electricity consumption 2,500 kWh.
"Next, in 2050, the energy mix from renewables is projected to increase until 31% with per capita energy reaching 3.2 ToE and per capita electricity consumption 7,000 kWh," Arifin concluded. (IY)
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