did you see that in the pre market?, page-43

Summary of PLN Renewable Energy Electricity Tariffs and the New Geothermal Electricity Tariff

Minister of Energy and Mineral Resources Regulation (MEMR) No. 22 of 2012 on the assignment to PT PLN (Persero) to purchase electricity from Geothermal Power Plants and the benchmark price of electricity purchase by PLN from Geothermal Power Plants (“Regulation”), has been issued, with immediate effect, on 23 August 2012. This Regulation revises the previous feed in tariff for geothermal power plants (MEMR Regulation No 2 of 2011, enacted on 16 February 2011) which was a flat 9.7 cents per kWh, to 10 to 17 cents per kWh based on geographical region, so as to attract more investment to the geothermal power industry in Indonesia.

The Regulation applies to purchases of electricity by PLN from geothermal power plants meeting any of the following criteria:
a. Holders of geothermal licenses:

issued after the publication of this Regulation;
who have yet to enter into a power purchase agreement.

b. Holders of authority, permit, or contract of geothermal exploitation issued prior to the enactment of Law No. 27 of 2003 on Geothermal:

who already have a power purchase agreement and will produce additional capacity;
whose power purchase agreement period has ended and will be extended;
who already have a power purchase agreement, whether or not they have already generated electricity and steam, if the parties agree on an amendment.

The Regulation requires PLN to purchase electricity from geothermal producers with a benchmark price for electricity purchased as follows:
No.

Area


Feed in Tariff for Geothermal Power Plants

(cent US$/kWh)

High Voltage


Medium Voltage
1.

Sumatra

10

11,5
2.

Java, Madura and Bali

11

12,5
3.

South, West and Southeast Sulawesi

12

13,5
4.

North and Central Sulawesi; Gorontalo

13

14,5
5.

East and West Nusa Tenggara

15

16,5
6.

Maluku and Papua

17

18,5


PLN can make purchases of electricity based on the benchmark without further negotiation. PLN can also purchase electricity at higher prices than set by the Regulation, however such prices must be approved by the MEMR.

The rates are a substantial increase from the previously regulated rates, which will have a direct effect on PLN. Therefore it remains to be seen the level of acceptance of the increased rates by PLN as the purchases of geothermal electricity, and by the Minister of Finance, as the business viability guarantor under the Fast Track II program.


Previously, MEMR enacted a similar regulation No. 4 of 2012 on Power Purchase Price by PT PLN (Persero) from Power Plants using Small and Medium Scale Renewable Energy or Excess Power (“Regulation 2”) in January 2012. PLN is obliged to purchase electricity from power plants that use small and medium scale renewable energy with 10 MW capacities or excess power from state owned enterprises, local owned enterprises, private companies, cooperatives, and governmental organizations.
The benchmark prices are as follows:
No.

Area


Feed in Tariff for Renewable Energy (Generally)
(Rp/kWh)

Medium Voltage

Low Voltage
1.

Java and Bali

656 x 1

1.004 x 1
2.

Sumatra and Sulawesi

656 x 1,2

1.004 x 1,2
3.

Kalimantan; East and West Nusa Tenggara

656 x 1,3

1.004 x 1,3
4.

Maluku and Papua

656 x 1,5

1.004 x 1,5

No.

Area


Feed in Tariff for Biomass and Biogas
(Rp/kWh)

Medium Voltage


Low Voltage
1.

Java, Madura, Bali and Sumatra

975 x 1

1.325 x 1
2.


Sulawesi, Kalimantan; East and West Nusa Tenggara

975 x 1,2

1.325 x 1,2
3.

Maluku and Papua

975 x 1,3

1.325 x 1,3


Feed in Tariff for Municipal Solid Waste that use Zero Waste Technology
(Rp/kWh)

Medium Voltage


Low Voltage
1.050

1.398


Feed in Tariff for Municipal Solid Waste that use Sanitary Landfill Technology
(Rp/kWh)

Medium Voltage


Low Voltage
850

1.198











PLN can make purchases of electricity based on the benchmark without further negotiation. PLN can also purchase electricity at higher prices than set by Regulation 2, however such prices must be approved by the MEMR. PLN can also purchase excess power during conditions of electricity supply crises with a higher price based on PLN estimates.


Sources: Minister of Energy and Mineral Resources Regulation No. 22 of 2012 on the assignment to PT PLN (Persero) to purchase electricity from Geothermal Power Plants and the benchmark price of electricity purchase by PLN from Geothermal Power Plants; and Minister of Energy and Mineral Resources Regulation No. 4 of 2012 on Power Purchase Price by PT PLN (Persero) from Power Plants using Small and Medium Scale Renewable Energy or Excess Power.