Exploring the Benefits of Renewable Energy in Tanah Pasundan

Bandung, January 24, 2024 – Renewable energy promotes sustainability and minimizes environmental impacts. In West Java, Indonesia, there is a growing focus on increasing the usage of renewable energy. According to the Energy and Mineral Resources Agency (ESDM) of West Java Province, the region has a renewable energy potential of 192 GW (gigawatts).

The West Java Provincial Energy and Mineral Resources Office, in collaboration with the Institute for Essential Services Reform (IESR), organized a four-day event named West Java Energy Explore from January 23 to January 26, 2024. The purpose of this event was to closely examine the renewable energy developments in the industrial and community sectors in Central Java. On the event’s second day, the group visited two renewable energy plants owned by PT PLN Nusantara Power. Later, the group went to PLTMH Gunung Halu in West Bandung Regency to visit a village.

Hydropower and Solar PV: Two Renewable Energy Sources that Complement Each Other

Cirata Hydroelectric Power Plant is one of the hydroelectric power plants that contributes significantly to providing clean energy in West Java. Ristanto Handri W, Senior Officer of PJB UP PLTA Cirata, explained that the plant has a 500 kV Java Madura Bali interconnection transmission system.

“This hydropower plant, built in the 1980s, has eight power plants with a total capacity of 1,008 megawatts (MW). This hydropower plant is the largest in Indonesia and second in Southeast Asia (after hydropower plants in Vietnam, ed),” said Ristanto.

Meanwhile, Cirata Floating Solar Power Plant (Solar PV) proves solar energy can be integrated into West Java’s energy portfolio. Dimas Kaharudin, Operations Director of PT Pembangunan Jawa Bali Masdar Solar Energy (PMSE), said that the Cirata floating solar power plant has an electricity production capacity of 192 megawatt peak (MWp) and has the potential for additional capacity up to 1000 MWp. 

“To keep the solar panel islands from moving, we use anchors. Each island requires 150 anchors located on the edge of the island. One island can produce up to 15.7 MWp. This solar PV proves that clean energy can compete economically with fossil energy,” Dimas said.

Dimas emphasized that a combination of hydropower and solar power plants in one area, such as the Cirata Floating Hydropower and Floating Solar Power Plant managed by PT Pembangkit Jawa Bali (PJB), can maintain a stable electricity supply.

“During the dry season, hydropower plants tend to have low production, whereas the solar power plants have high production. Conversely, during the rainy season, solar power plant production decreases while hydropower production increases. As a result, we can maximize its benefits by utilizing renewable energy in Cirata during both seasons,” Dimas said.

Gunung Halu Microhydro: Empowering Micro Energy for Local Communities

Local wisdom encourages understanding the surrounding natural patterns that have proven to empower the community, for example, in Tangsijaya Village, Gununghalu Village, Gununghalu District, West Bandung Regency, West Java. The residents of this village use and process river currents to generate electrical energy through the Micro Hydro Power Plant (PLTMH).

The operator of Gunung Halu Hydro, Toto Sutanto, explained that this Gunung Halu Micro Hydro has a capacity of around 18 kWh, which can provide electricity to 80 houses in Tangsijaya Village. Not only does the electrical energy from the micro hydro provide electricity for dozens of homes, but it also supports the operation of the coffee factory, which is the center of the village’s economy.

“We utilize the river water discharge of 400 liters/second and a head of 8 meters. The electricity generated from the micro hydro is channeled to residents’ homes, which are only charged Rp 25,000 per month. Meanwhile, public facilities, such as schools and mosques, as well as the homes of elderly residents, are not charged for electricity,” said Toto.

Cirata Floating Solar PV Plant Ready to Operate: Important Milestone for Accelerating Solar Energy Development to Decarbonize Electricity in Indonesia

Jakarta, November 9, 2023 – Cirata floating photovoltaic (PV) power plant located in Cirata Reservoir, West Java, with a capacity of 145 MW(ac) or 195 MW(p), has been inaugurated today. This event marks an important milestone for Indonesia as it is now home to the largest floating solar power plant in Southeast Asia, surpassing the Tengeh floating solar power plant in Singapore.

The Institute for Essential Services Reform (IESR) considers the operation of the Cirata floating PV power plant as a significant achievement in accelerating the development of large-scale solar power plants in Indonesia. The country’s solar power development has been almost non-existent since 2020. However, the decreasing investment cost of solar PV has made it the cheapest renewable energy source. Therefore, Indonesia must optimize the technical potential of PLTS, which reaches 3.7 TWp to 20 TWp, to support its goal of achieving the electricity sector’s peak emission target by 2030 at the lowest possible cost.

IESR also encourages the government and PLN to take advantage of the technical potential of floating PV power plants, which reach 28.4 GW from 783 water body locations in Indonesia, to accelerate the utilization of solar power plants. Based on the data from the Ministry of Energy and Mineral Resources shows that there is potential for large-scale floating solar power plants that can be developed in at least 27 locations of water bodies that have hydropower plants (PLTA), with a total potential of 4.8 GW and an investment equivalent to USD 3.84 billion (IDR 55.15 trillion). Utilizing the potential of this floating solar power plant will accelerate the achievement of the renewable energy mix target and achieve the net zero emission (NZE) target sooner than 2060.

The government and State Electricity Company (PLN) must optimize the potential of floating solar power plants by creating a regulatory framework that attracts businesses to invest in these plants. One way to achieve this is by offering an attractive rate of return on investment that matches the risk profile but is attractive and reduces additional burdens.

One area of concern for the government is PLN’s assignment scheme to its subsidiaries, which has been a priority option for developing floating solar power plants. Through this scheme, the subsidiary seeks equity investors for minority ownership but must be willing to bear a larger portion of equity through shareholder loans.  

“This scheme benefits PLN but cuts the return on investment for investors and risks the bankability of the project and the interest of lenders. This scheme can also create unfair business competition among business players, as only those with large equity can partner with PLN, and most investors are foreign. This could impact overall investment interest,” said Executive Director of IESR, Fabby Tumiwa.  

The solution, according to Fabby, requires government support by strengthening the capital of PLN and its subsidiaries through special state capital participation (PMN) for renewable energy development and providing concession loans to PLN through PT SMI, which can then be converted into share ownership in floating PV power plants project. 

Indonesia can reap the potential for investment and low-emission electricity from floating solar power plants with the support of definitive and binding regulations from the government. In July 2023, the government issued Minister of Public Works and Public Housing Regulation Number 7 of 2023 on the Second Amendment to the Regulation of the Minister of Public Works and Public Housing Number 27/PRT/M/2015 on Dams, which no longer limits the area of water bodies in reservoirs that can be utilized for floating solar power plants at 5%. The regulation opens up opportunities for the development of floating solar power plants on a larger scale, provided that when using more than 20% of the water body area, it is necessary to obtain a recommendation from the Dam Safety Commission.

Marlistya Citraningrum, Program Manager for Sustainable Energy Access, IESR, sees this as an opportunity to overcome land issues in developing solar PV.

“Land availability is often an obstacle in the development of solar PV, especially in areas already dense with high land prices, as well as land cover that may not be suitable for solar PV, for example, too steep or productive agricultural land. Indonesia also has several dams, whether hydropower or not, that could be used as potential sites. The Hijaunesia 2023 project, for example, has offered the development of floating solar power plants in Gajah Mungkur, Kedung Ombo, and Jatigede with a capacity of 100 MW each,” Marlistya mentioned.

However, according to Marlistya, the overall planning, tendering, and construction of floating solar power plants in Indonesia still needs to be improved. Despite being a flagship project and a form of intergovernmental cooperation (G2G), the timeline for completion of the Cirata floating solar power plant is quite long – starting with a memorandum of understanding between Indonesia and the United Arab Emirates in 2017 and the formation of a joint venture between PJB Investasi and Masdar in the same year, the signing of the new PPA took place in 2020 and financial closing in 2021. This lengthy process reduces the attractiveness of floating solar power plant investment in Indonesia.

The development of supply chains for solar PV and floating PV components in Indonesia is also wide open, including for solar cells and modules. Not only for the domestic market, which has yet to reach 1 GW, solar cells and modules with tier 1 criteria produced in Indonesia are also intended for foreign markets. Chinese tier 1 solar cell and module manufacturer Trina Solar has collaborated with Sinarmas to build an integrated solar cell and module factory in Kendal Industrial Estate, Central Java, with a production capacity of 1 GW/year.