Gas-fired power station up and running
The Jakarta Post, Jakarta
The gas-fired Muara Tawar power plant in Bekasi, West Java, started on Wednesday the operation of two power generation units with a combined capacity of 2x143 megawatts (MW).
Antara reported that the combined-cycle power plant is expected to be in full operation with six power generation units next month.
President of state utility company PT Perusahaan Listrik Negara (PLN) Eddie Widiono said that the full operation of the Muara Tawar plant could hopefully provide a significant boost to the power supply in the main Java-Bali power grid.
He pointed out that Muara Tawar would provide an additional 850 MW to the power grid. Muara Tawar, which has been developed by a Siemens-led consortium, will supply power to PLN.
The Java-Bali power grid has been facing power shortage problems due to a rapidly increasing demand in the region, the mostly populous area of the country.
The capacity of the Java-Bali power grid is around 21,000 MW.
But because of higher demand, the system will need an additional capacity of 12,000 MW by 2010, Eddie said.
He said that PLN could only supply an additional 5,000 or 6,000 MW by that time. He is hoping that private investors can play a significant role.
"By 2010, PLN is committed to supplying only 5,000-6,000 MW. Private participation will have to provide the rest," Eddie said.
Director of German-based PT Siemens Indonesia, Joachim Stender said as the company was ready to work with others in Indonesia on new power projects.
"We are interested in investing in the power sector, but we would like to see legal certainty with contracts that have been signed," Stender said.
Elsewhere, Eddie said PLN has appointed Bahana Sekuritas, Danareksa and Trimegah Sekuritas as underwriters for a planned bond issuance.
However, with the current bearish bond market, the company may not issue the bonds this year.
"We will try to speed up the bond issue but it will depend on the market. If the market conditions do not support the plan, we will not proceed," Eddie said.
PLN has planned to issue bonds totaling Rp 1 trillion to finance its project to build a liquefied natural gas (LNG) terminal in West Java and other projects.
The bond market has been down lately spurred by concerns of the U.S. Federal Reserve raising interest rates. It has already raised bond yields from emerging economies such as Indonesia.
A high yield, high risk bond would increase the costs of borrowing.
Eddie expects PLN's better performance in 2003 will boost the company's performance this year.