State utility PLN plans to add 32 gigawatts of renewable energy capacity and invest in grids that would be able to connect to more renewable power sources, its chief executive said on Wednesday.
Read more on JakartaPost.
PT Perusahaan Listrik Negara (PLN) is ambitious to realize an inter-island electricity network project in Indonesia. This project is believed to maximize the potential of renewable energy electricity from remote locations.
Read more on Katadata.
Executive Director of the Institute for Essential Services Reform (IESR), Fabby Tumiwa, said the cooperation between the State Electricity Company (PLN) and International Energy Agency (IEA) for this was excellent. PLN can get IEA technical assistance in designing PLN’s energy transition strategy.
Read more on Koran Jakarta.
Jakarta, February 8, 2023 – The State Electricity Company (PLN) is currently in the midst of a crisis of oversupply of electricity. Several factors cause this, including the pandemic and global recession. In addition, there is a 35 Gigawatt coal power plant megaproject that has been initiated since 2015 and operated at only 47% in 2022. However, there are also several misconceptions about this crisis. In a news program at the CNBC Energy Corner (6/2/2023), Herman Darnel Ibrahim, a member of the National Energy Council, and Fabby Tumiwa, Executive Director of the Institute for Essential Services Reform (IESR), discussed some of these misconceptions.
According to Herman, it is common for electricity service providers, including PLN, to set a percentage of reserve margin. Referencing other countries, 40-50% is a normal rate for the reserve margins to anticipate growth and maintenance. In 2022 alone, electricity growth was recorded at 6.15% (including from private power producers) and is expected to continue to increase in the coming years.
“On the island of Java itself, the reserve margin is probably 60%, while in other places there is a shortage of power. So in the next two years, it is estimated that there will be no overcapacity,” explained Herman.
According to Fabby, the growth percentage stated by Fabby does not reflect the actual rate of growth inside PLN, which is less than 5%. He considers that the current oversupply situation is due to a mismatch in demand projections that form the basis for planning and realizing the 35 GW.
“Of the 35 GW that have been planned, 5.4 GW have not been contracted and have not received funding. It would be good if this amount could be canceled or diverted to renewable energy,” explained Fabby.
Herman and Fabby agree that there needs to be an evaluation from PLN in various aspects. First, it must sharpen demand forecasting for electricity use, while taking into account electricity supply from private generators. This can reduce the possibility of excess capacity, which can result in costs to be borne by the government or increased tariffs on customers.
Second, there needs to be an evaluation of electricity purchase and sale contracts with private power producers, especially those using take or pay clauses. 80% of the excess supply of electricity comes from private producers, and each GW costs the state IDR 3 trillion.
Third, it is necessary to evaluate the schedule between projects. The tendency is that project completion is adjusted to government tenure. This does not match the gradual demand growth for electricity, instead there is a sudden increase in power capacity, which causes overcapacity.
“The COD schedule (commercial operation date) should be determined by PLN, not the government’s term of office. Usually, projects are planned year by year so that there is no under capacity or overcapacity,” said Herman.
“The remaining 5.4 GW is important to monitor. The project is mostly funded by China, while since a few years ago, China has not financed coal plant projects anymore, so if it is certain that there will be no funding, it is better to cancel or divert to renewable energy. Evaluation is then important to provide stability of supply and affordable electricity prices,” concluded Fabby.
Executive Director of the Institute for Essential Services Reform (IESR), Fabby Tumiwa, said the electricity surplus in Indonesia because its out-of-sync between the target of the 35,000 Mega Watt (MW) Steam Power Plant (PLTU) program and the realization of growth in electricity consumption.
Read more on CNBC.
The Institute for Essential Services Reform (IESR) encourages the government to review the clauses contained in the power purchase agreement (PJBL) between PT Perusahaan Listrik Negara (Persero) or PLN and private power developers or independent power producers (IPP).
Read more on Bisnis.
Jakarta, 24 November 2022- To be aligned with the GHG emission reduction target according to the Paris Agreement, the government and PLN need to achieve a renewable energy mix of up to 41% in the electricity system by 2030. However, until today the Indonesian government has only targeted 25% of the renewable energy mix by 2030. Technological innovation, competitive prices for renewable energy, and the potential for coal-fired power plants (CFPP) to become stranded assets are qualified factors for higher renewable energy penetration in eight years.
The Institute for Essential Services Reform issued its latest report entitled “Enabling high share of renewable energy in Indonesia’s power system by 2030” which analyzes the 2021-2030 electricity development plan (RUPTL), technological advances and prices, changes in fuel prices, and projections of electricity demand to provide more opportunities towards the integration of renewable energy into the electricity network in Indonesia. This study is based on the scenario of Indonesia’s energy system achieving net zero emissions in 2050, which is aligned with the target of limiting temperature rise below 1.5°C per the Paris Agreement. In this scenario, electricity growth is assumed to reach 4.5% and added to the additional electricity demand from accelerated electrification in the transportation and industrial sectors (heating).
Using a similar power system optimization model with PLN, IESR found that the capacity of renewable energy in the power grid in 2030 could be increased to 129 GW of renewable energy with 112.1 GW coming from solar energy, 9.2 GW hydropower, 5.2 GW geothermal, 1.5 GW wind turbine, and 1 GW of biomass in the combined Java-Bali, Sumatra, Kalimantan and Sulawesi systems. The renewable energy mix in the electricity sector is also projected to reach 32%, 35%, 35% and 51% respectively in the Java-Bali, Sumatra, Kalimantan and Sulawesi systems. Solar energy is dominant because of its highest potential, cheapest cost, and fastest installation period in any area, either on a roof or floating.
Meanwhile, the electricity mix from coal-fired power plants will significantly decrease to only 39% in the same year. Moreover, to overcome the variability and intermittency of renewable energy and maintain system reliability, Indonesia can optimize gas-fired power plants and build energy storage (batteries).
The findings from this study are far greater than the renewable energy in the 2021-2030 RUPTL, which only targets 20.9 GW.
“The results of this IESR study are very relevant to the Just Energy Transition Partnership (JETP) agreement that was announced at the G20. The target of JETP is a 34% renewable energy mix in 2030. Through this study, it is shown that the penetration of renewable energy generators in our electricity system is possible without impacting system reliability and electricity production costs,” said Fabby Tumiwa, Executive Director of IESR.
The results of the IESR analysis show that even with high penetration of renewable energy, the reserve margin (the percentage of additional installed capacity to annual peak demand) remains at PLN’s ideal limit of at least around 30%. This study also conducts a power flow analysis and analysis of system frequency stability in the Java-Bali and Sulawesi electricity systems in 2030. As a result, it requires upgrading several substations so that power can be distributed properly. However, this need can be minimized by distributing the development of renewable energy generators. Frequency stability was still achieved and complied with Indonesia’s grid code.
One of the keys to integrating renewable energy is increasing the flexibility of network operations, including implementing a flexible CFPP operation.
“Renewable energy’s intermittency is a challenge, but there are many strategic options that can be studied to be implemented in Indonesia. For instance, by using energy storage such as batteries and also more accurately forecasting renewable energy. System operations need to be changed to accommodate this,” said Akbar Bagaskara, Main Author of the Enabling high share of renewable energy in Indonesia’s power system by 2030 report.
The capacity of the transmission and distribution network also needs to be increased to ensure a smooth supply of electricity from renewable energy, especially in the Java-Bali and Sulawesi systems.
IESR views that higher integration of renewable energy in the electricity system needs to be encouraged by policymakers in Indonesia by issuing regulations that support the acceleration of renewable energy development, accelerate electrification in the industrial sector, stipulate flexible PLTU operating regulations, and support the development of the domestic solar panel industry.
Furthermore, PLN as an electricity utility company needs to actively develop infrastructure and network operations to become more flexible network operations to enable high integration of renewable energy.
“There is a need to change the operating paradigm of the electricity system to flexible operation, no longer baseload. Of course, it is necessary to develop an operating framework for an electricity system that can provide incentives for assets that can provide services to maintain network reliability or ancillary services. The design of this framework needs to be prepared from now on so that it is ready to be implemented when the renewable energy mix begins to grow rapidly,” explained Deon Arinaldo, Manager of the Energy Transformation Program, IESR.
Bali, 30 August 2022 – As the main contributor to GHG emissions in the energy sector, Civil of Twenty (C20) Indonesia urges power utility companies to set inevitable targets, and a clear climate mitigation roadmap to reach zero emission by 2050. Civil of Twenty (C20) Indonesia invited energy experts and representatives from G20 power utility companies to discuss and urge the long-term strategy proposed by these power utility companies to accelerate the clean energy transition in their respective countries so as to align with the 1.5C pathway.
Risnawati Utami, the Sous-Sherpa of C20 Indonesia, in her opening remarks emphasized the importance of Indonesia’s leadership to promote and engage all civil societies to influence the commitment and policy of the countries’ members to adopt the human rights principles and international cooperation in mitigating the climate risks.
“The role of international cooperation recognizes the government’s responsibility to work together internationally, to urge implementation plans and strategies to reduce climate risks,” said Utami in the webinar of C20 titled “Role of G20 Power Utilities in Climate Mitigation Efforts”.
The COP27 High-Level Champion, Mahmoud Mohieldin stated about 800 million people in the world are still living without electricity access. He said that solutions to overcome the energy problem and mitigate the climate crisis are the availability of adequate policy, effective implementation, localization and financing.
“The Paris Agreement needs to be aligned and integrated with the SDG framework, otherwise we are going to be suffering from a bad refabrication and partial approach,” said Moheildin.
He expected that in COP27 which will be held in Egypt, more countries will come up with a more holistic approach towards sustainability focusing on the implementation and projectization ideas and initiatives and more of emphasis on the regional dimension, localization, and finance.
Fabby Tumiwa, Co-chair of C20 Indonesia and Executive Director of the Institute for Essential Services Reform (IESR) stated that as Indonesia holds the G20 Presidency, it should take bold action in orchestrating its power utility to implement energy transition.
“Every country has to find its own way to deal with energy transition. The utility is facing serious challenges, such as climate change impacting the operation of the energy system, customer demands more renewable electricity at an affordable price, the workforce needs to upgrade with the current skill of renewable energy, regulation to limit carbon emissions, new technology is coming up that creates uncertainty in current utility business model,” said Fabby.
Fabby added that utilities need to adapt faster since there is limited time left to combat the climate crisis. Learning and skill shares among G20 members are crucial for utilities able to implement the solution immediately.
Philippe Benoit from Global Energy Policy, Columbia University presented that as State-owned Power Companies (SPCs) play a significant role in reducing GHG emissions, the government needs to reform it by influencing SPCs with policy options and targeted interventions directly and indirectly.
“The government can support SPC low carbon action by making resources available to SPC and advocacy, external pressure. But I would say, the easiest for a government that is committed to climate policy is to exercise the government shareholder power. For example, formal directive through Board resolutions and instructions, senior management appointments and dismissals,” said Benoit.
He added that other reformations of SPC include resourcing SPC low carbon actions with clear, consistent government direction, financing, complimentary or associated infrastructure, administrative support and capacity building for SPCs.
“SPCs need to participate in low carbon transition, as partners, not adversaries, and as enablers, not just producers. Empowering SPC low carbon action is key to achieving national and global climate goals,” he said.
Joojin Kim, Managing Director of Solutions for Our Climate (SFOC) offered a G20 outlook on accommodating more renewables in the power system.
“We are in a pivotal moment and state utilities in the G20 must show leadership to unite the international community around solutions to the climate crisis. Many G20 nations, especially in Asia, are experiencing significant curtailment of renewables. Amid the present global energy situation, curtailment poses further uncertainty and economic loss. To address such challenges, countries must establish a governance framework that will ensure fair access and compensation for technologies that contribute to grid flexibility in order to reduce fossil fuel expenditure and increase renewable energy in the power mix,” said Joojin.
Evy Haryadi, Director of Corporate Planning of Perusahaan Listrik Negara (PLN), Indonesia, stated that achieving Indonesia’s net-zero target by 2060 by phasing out coal and developing renewable energy needs enormous investment.
“Indonesia needs around USD 600 billion investment for carbon neutrality by 2060. We need support from international funders. However, for early retirement initiatives, the energy transition financing scheme is not existing in the market but is green financing. Transition financing still needs some regulatory framework, especially in international financing,” said Evy Haryadi.
This event is organized by the C20 working group of environment, climate justice, and energy transition (ECEWG). C20 is one of the engagement groups under the G20 which represents civil society voices and concerns.
Pada Desember 2019 lalu, IESR meluncurkan laporan Indonesia Clean Energy Outlook 2020. Dalam laporan ini, disampaikan evaluasi perkembangan energi terbarukan dan efisiensi energi selama 2019, serta pandangan prospek pengembangan energi bersih di Indonesia pada 2020 ini. Bagaimana prospek perkembangan energi bersih, khususnya energi terbarukan di Indonesia pada 2020? Salah satu temuan dalam ICEO 2020 mengindikasikan investasi di bidang energi terbarukan mengalami penurunan. Sejak 2015, realisasi investasi EBT terus menurun, padahal target investasi tahunan terus mengalami koreksi dari target Renstra KESDM 2015-2019. Bahkan target investasi EBT untuk 2019 sebesar $1,8 milyar hanya tercapai $1,5 milyar. Sepanjang 2015-2019 kapasitas pembangkit energi terbarukan (on-grid dan off-grid) bertambah 1,6 GW atau 11% dari total tambahan kapasitas terpasang pembangkit listrik sebesar 15,5 GW. Pencapaian ini jauh lebih rendah dari realisasi pada periode 2010-2014. Pada 2020 KESDM memasang target pembangkit energi terbarukan dapat bertambah 685 MW. Angka ini jauh lebih tinggi dari realisasi penambahan kapasitas pembangkit energi terbarukan pada 2019 sebesar 376 MW. Walaupun lebih tinggi tetapi sesungguhnya pertambahan kapasitas ini masih lebih rendah dari penambahan kapasitas pembangkit energi terbarukan yang ditargetkan dalam Rencana Umum Energi Nasional (RUEN). Untuk memenuhi target RUEN, setiap tahun sejak 2020, diperlukan penambahan kapasitas pembangkit energi terbarukan baru sebesar 4-5 GW.
Untuk dapat mencapai target tersebut maka diperlukan investasi yang cukup, kesiapan atau kemauan off-taker dan ketersediaan proyek-proyek yang feasible. Off taker yang terbesar adalah PLN yang memasok 95% energi listrik di Indonesia. Bagaimanakah status ketiga faktor ini di 2020?
Pertama, sejauh ini Indonesia belum menjadi target utama investasi energi bersih bagi investor asing. Daya tarik investasi untuk energi terbarukan tergolong biasa-biasa saja, tidak ada yang menonjol. Beberapa faktor utama antara lain: iklim investasi makro, kualitas kebijakan dan regulasi, rencana dan realisasi pembangunan energi terbarukan, ketersediaan pendanaan, serta akses pada teknologi dan rantai pasok domestik memiliki daya tarik yang lebih rendah bagi investor asing dibandingkan dengan negara-negara tetangga yang menjadi kompetitor kita. Investor berpandangan kebijakan dan regulasi tidak stabil, mudah berubah, kualitasnya rendah, dan ketidakjelasan dalam implementasinya. Hal-hal ini menyebabkan persepsi risiko investasi di sektor energi terbarukan sangat tinggi yang berakibat pada meningkatnya cost of money untuk investasi proyek energi terbarukan di negara kita.
Di 2020 ini, investor sepertinya akan mencermati langkah pemerintah memperbaiki iklim investasi energi terbarukan. Perubahan kebijakan dan regulasi yang menghambat perkembangan energi terbarukan selama tiga tahun terakhir ini ditunggu oleh para pelaku usaha. Rencana pemerintah menerbitkan aturan feed in tariff (FiT) untuk pembangkit listrik ET skala kecil dalam bentuk Peraturan Presiden menjadi angin segar bagi pelaku usaha swasta. Tapi FiT saja mungkin tidak cukup karena harga/tarif hanyalah sebagian dari hambatan pengembangan ET. Bagaimana pemerintah melalui instrumen regulasi mengalokasikan risiko-risiko tarif, kebijakan, teknologi, evakuasi daya secara berimbang untuk PLN dan pengembang, dan proses bisnis yang transparan juga menjadi perhatian para investor, khususnya investor asing. Sentimen positif akan terjadi di 2020 kalau ada realisasi komitmen politik dan produk perundangan yang signifikan di tahun ini.
Kedua, PLN sebagai satu-satunya off-taker listrik swasta, perkembangan energi terbarukan sangat dipengaruhi oleh visi, minat, perencanaan, lelang dan eksekusi dari BUMN ini. Beban pencapaian target energi terbarukan pun sebagian besar harus dipikul oleh PLN. Untuk mencapai target 23% sesuai Perpres No. 22/2017 maka dalam lima tahun mendatang, minimal 75-80% penambahan pembangkit listrik baru harus berasal dari energi terbarukan. Pada prakteknya untuk dapat masuk ke dalam sistem ketenagalistrikan, maka proyek energi terbarukan harus masuk dalam perencanaan PLN, yaitu Rencana Umum Penyediaan Tenaga Listrik (RUPTL).
Pada RUPTL 2019-2028, PLN merencanakan menambah 16,7 GW pembangkit energi terbarukan dimana 8 GW direncanakan pada kurun waktu 2019-2024. Untuk mencapai target RUEN, maka kapasitas pembangkit untuk energi terbarukan harus ditambah menjadi 12-15 GW pada kurun waktu tersebut dan dilipatgandakan pada lima tahun berikutnya. Konsekuensinya untuk dapat menampung kapasitas pembangkit energi terbarukan yang lebih besar maka PLN perlu melakukan pengurangan kapasitas pembangkit-pembangkit thermal yang direncanakan atau yang telah dioperasikan 5-10 GW dalam lima tahun mendatang.
Ada perbedaan antara target KESDM untuk penambahan kapasitas terpasang pembangkit ET di 2020 sebanyak 685 MW dengan RUPTL PLN sebesar 933 MW. Perbedaan ini merupakan sinyal bahwa ada persoalan dalam perencanaan kelistrikan dan koordinasi, khususnya untuk pembangkitan ET. Bagaimana perbedaan ini akan direkonsiliasi dalam RUPTL 2020-2029 yang kemungkinan akan terbit dalam beberapa waktu kedepan juga menjadi perhatian para investor dan pengembang.
Ketiga, ketersediaan proyek-proyek energi terbarukan yang bankable dan siap didanai merupakan salah satu faktor yang penting dalam memenuhi target penambahan kapasitas pembangkit listrik. Selama ini ketersedian proyek-proyek pembangkit energi terbarukan yang bankable jumlahnya terbatas. Berbeda dengan pembangkit thermal yang berkapasitas besar, pembangkit energi terbarukan kapasitasnya bervariasi dari skala dibawah 5 MW, 5-10 MW, 10-50 MW, dan diatas 50 MW. Misalkan untuk PLTS yang direncanakan mencapai 0,9 GW, hingga 2025 nanti, dapat terdiri dari 20-50 proyek dengan ukuran rata-rata 20-50 MW per proyek. PLTB yang direncanakan hingga 0,85 GW hingga 2025 dapat terdiri dari 15-30 proyek dengan kapasitas 10-100 MW per proyek.
Jadi, prospek pengembangan energi terbarukan di 2020 sebenarnya lebih baik dibandingkan tahun-tahun sebelumnya dengan adanya komitmen politik dari Presiden, langkah-langkah merevisi kebijakan dan regulasi harga ET (FiT) oleh Menteri ESDM, dan dukungan jajaran direksi PLN untuk mengembangkan energi terbarukan untuk mencapai target RUEN. Walaupun demikian, aksi-aksi positif ini tidak serta merta langsung meningkatkan daya tarik investasi dan realisasi investasi pembangkit pada tahun ini. Apabila pemerintah melakukan langkah-langkah perbaikan di tahun ini, paling tidak untuk tiga aspek diatas, dampaknya pun baru akan terasa dua sampai tiga tahun mendatang, yang ditandai dengan meningkatnya minat investor dan meningkatnya stok proyek-proyek pembangkit yang siap dikembangkan secara komersial.
Pemerintah harus melihat bahwa 2020 adalah tahun untuk memulihkan kepercayaan investor, dan tahun untuk memperkokoh fondasi untuk transformasi energi yang berkelanjutan di Indonesia. Kegagalan untuk melakukan perbaikan di tahun ini dapat berujung pada hilangnya momentum positif, hengkangnya investor asing, serta hilangnya kesempatan membangun sistem energi modern yang berkelanjutan dan kompetitif secara biaya dalam jangka panjang. Kalau ini terjadi, perlu waktu lama untuk membalik keadaan.
Jakarta, 15 Januari 2020.
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