From pv journal 03/23
Indonesian state-owned utility Perusahaan Listrik Negara (PLN) desires 2.4 GW of floating photo voltaic era capability by 2025, below its 10-year marketing strategy.
A report printed by the Institute for Important Companies Reform (IESR) in November 2021 acknowledged that PLN is constructing a 145 MW (AC) web site at Cirata Dam and a 60 MW (AC) undertaking at Saguling Dam, each in West Java, plus a 90 MW(AC) facility at Singkarak Lake, in West Sumatra.
The Cirata Floating Photo voltaic PV undertaking is being developed by UAE-state-owned Masdar Power and PLN subsidiary PT Pembangkitan Jawa Bali Investasi. The Ministry of Power and Mineral Sources spoke pv journal – by way of his Directorate-Common of New Renewable Power and Power Conservation – that Cirata “36.38%” will likely be full by December 2022, though it’s scheduled to be accomplished that 12 months. The ministry stated that the indoor house necessities for the photo voltaic modules hindered the monetary feasibility and the poor situation of the reservoir mattress had an advanced set up of the anchor system.
The floating Saguling and Singkarak initiatives are being developed by PLN unit PT Indonesia Energy and 50% state-owned Saudi developer ACWA Energy which, in October 2020, supplied to generate electrical energy at 30% lower than PLN’s tariff of $0.058/kWh, involves $0.041. “We see the good potential of the nation and its dedication to renewable vitality and net-zero emission targets,” stated Salman Baray, nation director of ACWA Energy Indonesia. “We’re working intently with Indonesia’s largest authorities utility firm, PLN, to assist their necessities.”
Baray additionally cited the issues brought on by getting sufficient photo voltaic panels in Indonesia. “An enormous problem we face is assembly the excessive native content material necessities for photo voltaic – that is one thing that every one photo voltaic builders face and battle to beat,” Baray stated. “In truth, it’s nearly unimaginable, at this stage, to satisfy the necessities for utility-related initiatives and we hope that issues will enhance considerably on this space.”
Made in Indonesia
Native content material necessities are established in rules 4/2017 and 5/2017, issued by the Ministry of Business. The foundations require 34% to 40% of kit – together with photo voltaic modules, inverters, and mounting buildings – to come back from Indonesian trade. All undertaking companies – resembling logistics, set up, and development – should be supplied by Indonesian firms.
Concerning the panel content material, 60% should come from Indonesian producers. The plan is for demand to hit 90% by 2025, supported by native polysilicon, ingot, and metallurgical-grade silicon manufacturing, based on IESR’s “Photo voltaic Power Outlook 2023.” There seems to be no likelihood of that occuring, with the IESR saying that the dearth of cell manufacturing in Indonesia signifies that module assemblers can solely obtain 47.5% native content material. The initiatives lack the required regulation because of this.
Knowledge launched by the vitality ministry in 2022 lists 21 photo voltaic panel assemblers in Indonesia with a complete annual manufacturing capability of 1.6 GW. Module elements together with tempered glass, EVA movie, and PV ribbons can’t be produced domestically.
No Indonesian photo voltaic producer has reached 100 MW of annual manufacturing capability. “If we’d like 150 MW of photo voltaic modules, no firm can promote us that capability,” Baray stated. “We’ve to purchase it from not less than two to 3 producers, which creates all types of challenges together with the issue of getting financing. One other problem can be using outdated know-how, which has a worth which is about 20% to 30% increased than, say, the price of panels from China.
Banking fears
The shortage of enormous photo voltaic firms causes undertaking bankability issues. Loans generally utilized by builders require firms to work on modules from tier-1 producers. Tier 1 is outlined as having provided merchandise to not less than six initiatives inside two years and obtained non-recourse finance from six industrial banks throughout the identical interval. Indonesian photo voltaic firms don’t meet that customary.
The IESR says the federal government ought to present flexibility in native content material. “Indonesia has outlined its inexperienced ambitions and is working in direction of them,” agreed Baray. “Nonetheless, the present restrictions are more likely to stop the achievement of its targets. We should develop native industries by creating ample demand, which can permit native producers to develop and benefit from economies of scale . If our firm pays to purchase panels – with outdated know-how at the next worth – it’s going to enhance the tariff. PLN then has two choices: To move on the extra tariff to prospects or to method the Ministry of Finance for subsidies The latter, Baray added, ought to go on to photo voltaic producers, as an alternative of reaching them by way of PLN and photo voltaic builders.
“PLN usually will get a foul fame for asking for extra subsidies,” stated the ACWA consultant. PLN didn’t reply to repeated interview requests from pv journal.
IESR’s 2021 report states that steelmaker PT Krakatau Metal is constructing a 12.5 MW (AC) undertaking at Krenceng Dam, in Cilegon, West Java, in partnership with renewables developer PT Akuo Power. Aluminum smelter PT Inalum and coal miner PT Bukit Asam are growing 770 kW (AC) at FPV websites at Sigura-Gura Dam in North Sumatra.
These websites will dwarf the undertaking put up by Badan Pengusahaan Batam, the federal government company for the free port space of Batam. The set up, at Duriangkang Dam close to Batam Metropolis, is reported by IESR, in 2021, as a 1.7 GW/4 GWh FPV and battery storage plant to be collectively developed by Singapore-based Sunseap. The vitality ministry, nevertheless, just lately introduced that the undertaking associate is now PT Batam Sarana Surya subsidiary of coal miner PT Adaro Power Indonesia. The ability is presently described as a 1 GW floating photo voltaic plant.
The directorate-general for renewables spoke pv journal that PLN’s PT PLN Batam unit will take 20% of the facility produced on the web site, with the remaining being exported to Singapore. There isn’t a set date for industrial operation as a result of the builders are ready to seek out out, from the Ministry of Public Works and Housing, how a lot the reservoir can host FPV. Rules state {that a} most of 5% of the floor space of dams, lakes, and reservoirs will be coated however Batam Sarana Surya desires to cowl 42% of Duriangkang Dam. Authorities permits are additionally required for the event of a forest space.
Some FPV websites are pushed by company sustainability insurance policies, based on IESR Photo voltaic Analyst Daniel Kurniawan. He speaks pv journal that “the most important purpose for the rising initiative from industries and companies is their sustainability objectives and the strain to decrease their CO.2 emissions. Additionally it is good for firms to fulfill their sustainability targets and, on the identical time, to scale back electrical energy prices. For firms, in addition they do not need to adjust to the native content material requirement of PV panels if they don’t promote their electrical energy to PLN.
G20 collapse
Jakarta secured an settlement on the G20 summit held in Bali in November 2022 that can see the governments of the US, Japan, Canada, Denmark, France, Germany, Italy, Norway, and the UK – along with the EU – present $10 billion which is affordable. loans, grants, and fairness funding to assist wean Indonesia off coal. The US says personal monetary establishments will provide one other $10 billion as a part of the $20 billion Simply Power Transition Program.
In return, Jakarta has promised that emissions from the facility sector will start to fall this decade and the nation’s energy will likely be emission-free by 2050. Ministers are engaged on a renewed technique.
Power exports
The state of affairs concerning clear vitality exports stays unclear, based on IESR, which says the federal government has but to difficulty any permits regardless of not less than 5 builders trying. in export-oriented photo voltaic initiatives within the Riau Islands. Builders responded to a name made by Singapore in October 2021 for the availability of “low carbon electrical energy” from 4 GW of era capability, however Indonesian President Joko Widodo reportedly desires to ban the export of inexperienced electrical energy for worry of lacking home emissions- discount targets. Clear electrical energy exports are allowed so long as home demand is glad, the exported vitality will not be sponsored, and the standard and reliability of electrical energy will not be affected. Nonetheless, Jakarta has not but issued any permits, based on IESR.
Whereas the nation presently produces a surplus of electrical energy, it comes from coal-fired energy crops, severely limiting the marketplace for overseas consumers. With neighboring Malaysia already exporting clear energy, decades-old talks about connecting the facility grids of the ten international locations of the Affiliation of Southeast Asian Nations (ASEAN) have gained new prominence.
“Governments are actually pondering critically about tips on how to clear up their electrical energy system – particularly when electrical energy wants in Southeast Asia are anticipated to develop quickly,” stated Caroline Chua, a BloombergNEF analyst in Singapore. “Many are on the lookout for a substitute for coal-fired energy crops.”
The problem, stated Chua, is that the ASEAN grids require quite a lot of harmonization by way of insurance policies, rules, and market operations, as soon as the grids are linked to one another. “ASEAN is geographically divided, not like Europe,” he stated. “This raises questions on infrastructure financing, how they combine electrical energy markets, and, after all, about vitality safety to make sure dependable provide.”
BloombergNEF says that pilot initiatives in direction of a unified grid community are happening in Thailand, Laos, Malaysia, Vietnam, and Singapore, and there are already cross-border interconnections between some electrical energy markets. Singapore is actively attempting to supply clear electrical energy imports to assist it meet its local weather objectives.
“This instance exhibits how a rustic within the Southeast Asian area will help develop renewables abroad,” added Chua. “The know-how for cross-border energy buying and selling exists. Nonetheless, in the case of financing, it may be very tough, particularly in Southeast Asian international locations the place the facility market continues to be very managed.”
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