House passes geothermal bill into law<\/p>\n
Fitri Wulandari, The Jakarta Post, Jakarta<\/p>\n
All nine factions of the House of Representatives agreed to pass
\nthe geothermal bill into law on Tuesday, which is expected to be
\nable to lure more investors into developing the country's
\ngeothermal sector.<\/p>\n
They said it would give legal certainty for investors to
\ninvest in the high-risk geothermal sector in the country while
\nprotecting the public from environmental hazards caused by
\ngeothermal exploration activities.<\/p>\n
Minister of Research and Technology Hatta Radjasa, on behalf
\nof the minister of energy and mineral resources, said the law was
\nexpected to attract investors to the sector.<\/p>\n
The law covers operational management, revenue splits between
\nthe central and regional government, as well as division of
\nauthority between the two in managing the geothermal resources.<\/p>\n
\"Thus, regions with geothermal resources could benefit (from
\nthe investment),\" Hatta said in his speech before the plenary
\nsession.<\/p>\n
Incentives to be offered to investors in the geothermal sector
\naccording to the law include tax facilities.<\/p>\n
\"The law will provide legal certainty for investors to get tax
\nfacilities according to related regulations,\" Hatta said.<\/p>\n
Geothermal energy refers to underground steam that can be
\nused to generate power. It is considered an environmentally clean
\nenergy source.<\/p>\n
Sitting on the so-called \"ring of fire\" volcano belt,
\nIndonesia is blessed with enormous geothermal resources.<\/p>\n
Indonesian Geothermal Association (INAGA) data says 40 percent
\nof the world's geothermal resources are located in Indonesia,
\nwhich could potentially produce 20,000 megawatts (MW) of
\nelectricity.<\/p>\n
Geothermal resources were under the supervision of state-owned
\noil and gas company Pertamina until May 2000, when the government
\nissued regulations transferring supervisory powers to local
\ngovernments.<\/p>\n
In 2002, Pertamina handed over to the government 18 geothermal
\nfields. Pertamina could not operate the fields because of a lack
\nof funds.<\/p>\n
Hatta added the law was crucial as fossil fuel had limited
\nsupplies and was non-renewable.<\/p>\n
Irwan Prayitno of the Reform faction said the law will not
\nonly guarantee returns on investment but also make sure contracts
\nwill be respected.<\/p>\n
According to Irwan, the law stipulates that contracts for
\ndeveloping geothermal resources spans between 20 years to 30
\nyears.<\/p>\n
\"Development of geothermal resources so far is very limited.
\nThe law could boost wider use of geothermal energy,\" Irwan told
\nThe Jakarta Post.<\/p>\n
His counterpart, Rustam E. Tamburaka of Golkar Party faction,
\nsaid his party supported the law on the grounds that geothermal
\nenergy could be used to prevent a power crisis.<\/p>\n
At present, Indonesia has a number of geothermal power plants
\nwith a combined capacity of 747.5 MW. The plants are located in
\nKamojang, Salak, Darajat and Wayang Windu in West Java; Lahendong
\nin North Sulawesi and Sibayak in North Sumatra.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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