Govt told to get behind geothermal energy plants<\/p>\n
JAKARTA (JP): Indonesia's geothermal energy industry needs a
\nboost from government incentives in order to help the nation meet
\nits energy goals, an industry leader said.<\/p>\n
Prijanto, chairman of the Indonesian Geothermal Association,
\nsaid yesterday that without incentives, it would be difficult to
\nmeet the government's target of developing a geothermal energy
\ngeneration capacity of 1,500 Megawatt (MW) by the end of the
\nsixth five-year development block in 1999.<\/p>\n
High capital costs and high risks are two main factors
\ndiscouraging investors from developing energy resources, he said,
\naddressing reporters after the opening ceremony of the
\nassociation's annual scientific meeting.<\/p>\n
Tax incentives, he suggested, could be given in the form of an
\nacceleration of capital depreciation.<\/p>\n
If the government gives tax incentives to geothermal energy
\ninvestors, the cost could be reduced by two U.S. cents to about
\nfive U.S. cents, he said.<\/p>\n
The cost of electricity generated by geothermal steam is still
\nmore than seven U.S. cents, compared with an average of six cents
\nfor electricity generated by using coal and gas.<\/p>\n
Currently, only 309.5 MW of Indonesia's total potential energy
\ncapacity of 20,000 MW have been developed.<\/p>\n
The 309.5 MW are generated by five geothermal power stations:
\nSibayak in North Sumatra (by Pertamina); Kamojang (by PT Latoha);
\nGunung Salak (by Unocal Geothermal Indonesia); Darajat (by
\nAmoseas) in West Java; and Lahendong (by Pertamina) in North
\nSulawesi.<\/p>\n
\"Relatively speaking, geothermal energy is not yet competitive
\ncompared with other energy resources, such as coal and gas, in
\ngenerating electricity,\" he said.<\/p>\n
Another challenge facing the geothermal energy industry is the
\ntransport cost, which is higher than other energy sources because
\nmost geothermal energy is located in remote areas far away from
\nthe consumers.<\/p>\n
The development of the geothermal energy sector is also
\nlimited by technology, Prijanto said. Geothermal power plants
\nmust be developed in stages, making the return on investments
\nmuch slower than for other energy investments.<\/p>\n
\"Those factors have made the development of geothermal energy
\nslower than for other energy resources, such as gas and coal,\" he
\nnoted.<\/p>\n
Minister of Mines and Energy I.B. Sudjana told the meeting
\nthat the government has been trying to diversify its commercial
\nenergy away from oil, which still dominates the country's energy
\nportfolio.<\/p>\n
Sudjana said that 41 percent of Indonesia's total generation
\ncapacity of 13,129 MW is produced by using fuel oil.<\/p>\n
\"We aim to reduce the oil-fired power plants, so that we can
\nsave our fuel oil for exports,\" he said in his written speech,
\nwhich was read by Adjat Soedradjat, the director general of
\ngeology and mineral resources.<\/p>\n
Geothermal energy is a priority because it is renewable, the
\nminister said, urging the geothermal association to help
\naccelerate the development of the geothermal power plants around
\nthe country.<\/p>\n
According to Prijanto, using geothermal energy to produce
\n1,000 MW of electricity can save about 300 million barrels of
\noil.<\/p>\n
Meanwhile, Indonesia's electricity demand grows at 12 percent
\na year.<\/p>\n
The state-owned electricity company PLN, which has offered
\nprivate investors the opportunity to develop power stations under
\nthe build-operate-and-transfer or build-operate-and-own schemes,
\nplans to raise its generating capacity from the current 13,129 MW
\nto around 39,000 MW by 2004. (bnt)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-told-to-get-behind-geothermal-energy-plants-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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