PLN to build power plant in N. Jakarta

PLN to build power plant in N. Jakarta

State electricity company PT PLN plans to build a new 600 megawatt power plant northeast of Jakarta in an effort to arrest a power shortfall in the country's main Java-Bali grid, said a senior executive of the company.

Power shortages have been plaguing most of Indonesia due to a halt in new investments since 1998, Parno Isworo, PLN's finance director, said Wednesday.

The new facility, to be located in the village of Muara Tawar, is estimated to cost US$400 million. It will use gas turbines which will rely mainly on diesel as a feedstock, said Isworo.

Construction of the new plant will most likely start in March 2003, and be completed by 2004, he added.

Muara Tawar already has a combined cycle power plant, with the capacity to produce more than 1,000 MW of electricity.

PLN hopes to finance 50 percent of Muara Tawar's power generating capacity expansion with loans from Indonesian banks, Isworo said. The remaining $200 million may be financed by other means including a planned PLN bond issue in 2003, he added.

"The (financing) plans are still on the drawing board," he said.

Prior to the 1997 Asian crisis, PLN budgeted as much US$5 billion annually for power project investment to cope with Indonesia's double-digit demand growth, Parno Isworo said. -- Dow Jones