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Home » Electrical Power » Government of Indonesia to Auction Geothermal Power Blocks


Electrical Power | 13-Apr-2016 | 02:30

The government of Indonesia will offer 21 geothermal blocks to investors over the next two years. Combined these 21 blocks, which are estimated to require USD $4.2 billion in investment, have a power generation capacity of 1,065 megawatt (MW). An official of Indonesia's Ministry of Energy and Mineral Resources said most of the geothermal power blocks will be offered through an open auction. The first auction is expected to take place in March 2016.

Yunus Saifulhak, Chief of Geothermal Power at the Energy Ministry's Directorate General, said the government has selected 26 geothermal working areas to be offered to investors. Five have already been tendered last year. The remaining 21 blocks are set to be offered in 2016-2017. The Indonesian government is currently studying which blocks are ready to be tendered first.

The five blocks that were tendered last year are Kepahiang (Bengkulu), Marana (Central Sulawesi), Way Ratai (Lampung), Mount Lawu (Central/East Java) and Lake Ranau (Lampung/South Sumatra). 

Saifulhak added that 16 blocks will be offered through an open auction, eight in 2016 and eight in 2017. For the remaining five geothermal blocks the government will select the operator (a state-owned company) through direct appointment. Most likely the government will appoint Pertamina Geothermal Energy (PGE), subsidiary of energy company Pertamina, to operate these blocks.

21 Geothermal Power Projects to Be Tendered in 2016-2017:

Block

Capacity (MW)

Estimated Investment

Bonjol

          60

  USD 240 million

Gunung Talang Bukit Kili

          20

  USD 80 million

Gunung Endut

          40

  USD 160 million

Candi Umbul Telomoyo

          55

  USD 220 million

Gunung Wilis

          20

  USD 80 million

Gunung Arjuno Welirang

         110

  USD 440 million

Gunung Pandan

          10

  USD 40 million

Gunung Gede Pangrango

          55

  USD 220 million

Songgonti

          20

  USD 80 million

Sipoholon Ria-Ria

          20

  USD 80 million

Simbolon Samosir

         110

  USD 440 million

Graho Nyabu

         110

  USD 440 million

Suwawa

          20

  USD 80 million

Sembalun

          20

  USD 80 million

Oka-Ile Ange

          10

  USD 40 million

Bora Pulu

          40

  USD 160 million

Gunung Hamiding

          10

  USD 40 million

Bonga Wayaua

           5

  USD 20 million

Gunung Geureudong

         110

  USD 440 million

Gunung Galunggung

         110

  USD 440 million

Gunung Ciremai

         110

  USD 440 million

Source: Ministry of Energy and Mineral Resources

Renewable energy is projected to account for 23 percent of Indonesia's total primary energy by 2025 (from 5 percent currently). To accomplish this target the Indonesian government has high hopes for geothermal energy development. Indonesia is estimated to contain about 40 percent of the world's geothermal reserves. However, most of these reserves remain untapped due to the lack of financial resources, the complicated investment climate (particularly when it involves natural resources), and uncompetitive power tariffs. Indonesia currently uses 1,439 MW of geothermal-derived power, less than five percent of the total potential (29,475 MW).

Energy Mix Indonesia:

 

 Energy Mix
      2011

 Energy Mix
      2025

Oil

       50%

       25%

Coal

       24%

       30%

Gas

       20%

       22%

Renewable Energy

        6%

       23%

Source: Ministry of Energy and Mineral Resources

These geothermal power blocks are not part of the government's recently unveiled program to provide an additional 35,000 MW of power capacity by 2019.

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