Indonesia at Work on Presidential Regulation for Renewable Energy, an Industrial Info Market Brief

The government of Indonesia is working on the Presidential Regulation (PERPRES) to regulate the electricity price on renewable energy, and four major schemes are to be considered on this draft: feed-in tariff, lowest bid, highest benchmark and agreement. In addition, the proposed location is also subject for consideration.

Feed-in tariff will be applied on hydro, solar, wind, and the expansion for solar and wind with a maximum capacity of 20 megawatts (MW), as well as biomass and biogas, including expansion projects or Excess Power with the maximum capacity 10 MW.

The agreement price is applied for hydro, solar and wind projects with a capacity of more than 20 MW, peaker hydro power or expansion projects and all the capacities contracted for excess power projects--also the expansion projects and excess power projects for biomass and biogas with a capacity of more than 10 MW, fuel power plants vegetable (BBN), and marine energy. Location and the capacity of the project will also be considered to set this renewable energy price.

Other than the feed-in tariff, the draft also includes the government's commitment to develop renewable clean energy to supply in remote areas, replace diesel power plants over the next three years and replace the old coal-fired power plant with environmentally friendlier coal power.

There is no finality as to when the presidential regulation will be published, since the Ministry of Energy and Mineral Resources (ESDM) stated that draft is still in the process.