Presented in Asean Clean Energy Week, November 2020
Despite the pandemic covid 19, Indonesia commits to promote the utilization of Renewable Energy in our Energy Mix
Call Now ☎ Russian Call Girls Connaught Place @ 9899900591 # Russian Escorts ...
Acceleration the utilization of Renewable Energy
1. 1
Accelerating the Utilization of Renewable Energy
Presented on Asean Clean Energy Week – Ministerial Opening Talk
Webinar, 24 November 2020
Sampe L. Purba
Senior Advisor to Minister of EMR on Economy of Natural
Resources
Ministry of Energy and Mineral Resources,
Republic of Indonesia
4. 4
POLICY UPDATE
Paris Agreement and Energy Sector Commitment
General Plan on National Energy – Target and Realization
Regulation Drafting on Renewable Power Acceleration to
Utilization
5. 5
PARIS AGREEMENT
AND ENERGY SECTOR COMMITMENT
Mitigation measures will be performed by:
1. Diverting fuel subsidy budget for
productive activities (infrastructure);
2. Targeting renewable energy portion
for 23% in the total of national primary
energy mix by 2025;
3. Developing Waste to Energy (WtE).
Energy Sector Commitment:
Reducing greenhouse gas emission for 314-398 Million Ton of
CO2 by 2030
Government Regulation No. 79 of 2014 on National Energy Policy and
Presidential Regulation No. 22 of 2017 on RUEN: Target 23% NRE from
Primary Energy Mix & 17% EE from BAU of Final Energy
National Commitment:
The mandate of Law No 16/2016 on Paris Agreement Ratification
Reducing greenhouse gas emission based on NDC by 2030:
29% from BaU
(unconditional scenario)
41% from BaU
(international assistance)
Global Commitment
Paris Agreement Target:
Holding the increase in the global average temperature below
2°C , and limit the temperature increase to 1.5°C
5
6. 6
9,15%
33,58%
20,12%
37,15%
23%
25%22%
30%
31%
20%24%
25%
Realisatio
n 2019 Target
2025
Target
2050
1. Energy Consumption: 0,8 TOE/cap
2. Electricity Consumption: 1.084 Kwh/cap
3. Total Generation Capacity: 69,7 GW*)
1. Energy Consumption:
1,4 TOE/cap
2. Electricity
Consumption:
2500 Kwh/cap
1. Energy Consumption:
3,2 TOE/cap
2. Electricity
Consumption:
7000 Kwh/cap
3. Total Generation
Capacity: 443,1 GW*)
REALIZATION AND TARGET
GENERAL PLAN ON NATIONAL ENERGY
NRE Oil GasCoal
6
*) Indonesia’s population in 2019 was 267 million and by
2050 will reach 335 million (based on RUEN assumption).
Source: National Energy Council and Pusdatin
4.37 4.35
5.41
3.77 3.92
4.96
5.33
4.38
6.47 6.34
8.55
9.15
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
* NRE Progres
on Energy Mix (%)
7. 7
Pres. Reg.
Draft
Price
1. FiT staging 2 no excalation with location :
• PLTA/M/MH (including dam PLTA), PLTS, PLTB capacity
up to 20 MW
• PLTBm, and PLTBg capacity up to 10 MW
• Expansion and excess power, except PLTA/M/MH
2. The lowest price based on direct selection:
• PLTS and PLTB >20 MW
• PLTBm, PLTBg > 10 MW
3. Agreement:
• PLTA (including dam PLTA) > 20MW;
• PLTA Peaker, PLTA/M/MH expansion and excess power
• PLTU using biomass for co-firing
Power Purchase Implementation
1. Direct appointment for:
• PLTA/M/MH, PLTBm, PLTBg for all capacity,
• PLTS and PLTB capacity up to 20 MW
2. Direct appointment in a form of Dams PLTA/M/MH
assignment
3. Direct selection: PLTS and PLTB >20MW; PLTBm and
PLTBg > 10 MW
4. BOOT through B to B
5. Contract period 30 years for PLTA/M, PLTS and PLTB
6. Contract period 20 years for PLTBm and PLTBg
7. Transaction in rupiah;
Scope
1. PLTA/M/MH -Hydro
2. PLTS (including floating PLTS) -
Solar
3. PLTB - Wind
4. PLTBm - Biomass
5. PLTBg - Biogass
6. Geothrmal energy
Governmental Support
1. Involving other Ministry/institution
2. Giving incentive and investment facility in a form of fiscal and non
fiscal in central and regional level
3. Minister of EMR grants price approval and determine NRE quota
4. Minister of Finance provides fiscal incentive and compensation to
PLN if the electricity purchase price > PLN’s BPP
5. Minister of Home Affairs supports the development of renewable
power plants in regional government
6. Minister of ATR/BPN, Minister of Environment and Forestry could
provide land to reduce investment cost for NRE utilization
7. Minister of Industry gives support to developers and local
technology producers
8. Minister of Public Works and Housing gives permit facility and fee
waiver for Hydro Resources Management Service
9. Minister of SOE set the target of NRE utilization in PLN
performance indicator
10. BKPM conduct integrated licensing and monitor the
implementation of ease of license issuence in central and
regional level
Transitional Provisions
Accomodating price adjustment for renewable power plants that:
1. not yet having PPA
2. have been determined as the tender winner
3. receive assignment from the Government
4. the procurement process is on going
5. has received price approval but not yet having PPA
Closing Provisions
1. The provisions of electricity purchase price will be evaluated 3
(three) years at the most since the promulgation of Presidential
Regulation
2. Revoking MEMR Regulation 10/2017 and MEMR Regulation
50/2017
PRES. REG. DRAFT ON RENEWABLE POWER PURCHASE
Spesific Provisions
If the land is provided by the government, the price will be
set separately
11. 11
STRATEGY TO ACHIEVE THE 23%
TARGET OF NRE BY 2025 BY PLN
Developing a strategy to achieve the
target of 23% renewable energy by 2025
through three programs: Green Booster,
Large Scale Power Plant, and PV Rooftop
• Green booster (beyond RUPTL): 5.2 GW
- Solar PV in Ex-Mining Are : 435.2 MW
- Floating Solar PV: 612 MW
- Solar PV in Existing PLN’S Power Plant:
112.5 MW
- Co-firing: 1027 MW
- Diesel to NRE Power Plant Conversion:
2600 MW
- Multi-use Dams Utilization: 362 MW
• Large Scale PP: 2.2 GW
- Kayan I Hydropower: 900 MW
- Mentarang Hydropower : 1375 MW
• Rooftop PV: 3.2 GW
RESULTS
OBJECTIVES
12. 12
• Covid Related issue
• Challenge to Renewable Energy Development
• Opportunity widely open for investment in Renewable
Energy
• Simplified Process and Procedures
Way Forward
13. 13
• Lockdowns in some countries have significantly reduced electricity demand.
• Global electricity demand is down 2.5% (Q1 2020 compared to Q1 2019). Average decrease in
demand by 20% under total lockdown.
• Reducing demand has increased the share of Renewable Energy in electricity supply because
its output is largely unaffected. Demand is down mostly in coal, gas and nuclear energy
sources.
• Projections for 2020 will decrease global electricity demand by 5-10%.
• The recovery of the impact of the decline in electricity demand depends on the speed of
economic recovery. A fast recovery will encourage a large consumption of fossils while a
moderate or slow recovery encourages the utilization of RE sources.
GLOBAL ELECTRICAL CONDITIONS DURING COVID-19
14. 1414
RE market in Indonesia has not yet entered into an economic scale, so the
price is still high
relying on imported technology >> Dependency, Price, domestic economic
impact
Limited Electricity Transmission & Distribution Network Infrastructure
Limited access to low cost funding
01
02
03
04
Human resources capability in the developing renewable energy that meets
international standards05
RENEWABLE ENERGY DEVELOPMENT
CHALLENGES
15. 15
AN OPPORTUNITY ON RENEWABLE ENERGY INVESTMENT
15
Legal Basis
MEMR Regulation No 50/2017 jo No. 53/2018 jo. No.
4/2020 Utilization of Renewable Energy for Electricity
Supply
MEMR Regulation No 38/2016
Acceleration of Electrification in Undeveloped Rural
Area, Remote Areas, Border Areas, and Small Island
with Population through the Implementation of Small
Scale Power Supply
MEMR Regulation No. 49/2018 jo. 13/2019 jo. 16/2019
Utilization of Rooftop PV by PLN’s Consumer
Legal Basis
Presidential Decree No. 47/2017 : LTSHE
MEMR Regulation No.33/2017 jo 5/2018
Procedure for Providing LTSHE
MEMR Regulation No. 3/2017
Operational Guidelines for Assignment Special Allocation
Fund (State Budget) for Small Scale Energy
MEMR Regulation No. 39/2017 jo No. 12/2018
Implementation Physical Activity of Renewable Energy
Utilization (State Budget)
Commercial:
• On-grid and comunnal off-grid: Solar PV,
Hydro, Mini/microhydro, Wind, Bioenergy,
Ocean Energy
• Investation: Private Sector, BUMN
Non-Commercial:
• For village, outer and border area
• Off-grid: Solar PV, Hydro, Mini/microhydro,
Wind, Bioenergy, Ocean Energy,
SHS/LTSHE, Street Lighting with Solar PV
16. 16
According to the
legislation provision
UU
Electricity Purchase Implementation
Direct selection
Type of Power Plant
Solar PV, Hydro, Mini/Microhydro, Wind, Geothermal, Bioenergy,
Ocean Energy, Waste Energy
Geothermal and
Waste Energy
Hydro, Mini/Microhydro,
Wind, Solar PV, Biomass,
Biogas, Biofuel PP, and
Ocean Energy
2017 :
70 PPA
2018 :
5 PPA
2019 :
7 PPA
2020:
1 PPA
MEMR Regulation No. 50/2017 jo No. 53/2018 jo No. 4/2020
Renewable Energy Utilization for affordable Electricity Provision for the people
Direct appointment, in case:
1. Local system in crisis or emergency conditions for electrical supply
2. Excess power
3. Expantion capacity in the same location
4. There is only one potential developer
5. Already have permit regarding the location before
MEMR No. 4/2020 wa issued
Direct appointment through assignment: waste energy, hydro that
utilizes dam/reservoir, projects that build with grantElectricity Purchase Price
Solar
Wind
Biomass
Biogas
Ocean
Energy
If Generation Cost Production (BPP) at
region’s electrification system :
>
≤
The national BPP on average
maksimum purchasing price 85% of
region’s Generation BPP
The national BPP on average
BPP based on agreement (business
to business)
If Generation BPP at region’s electrification system >
the national BPP on average, Maximum price
100% of region’s Generation BPP
Municipal
Waste
Geother-
mal
Hydro
If Generation BPP at region’s electrification
system ≤ the national BPP on average, Price
based on parties negotiation (business to
business)
For Biofuel
PP, hydro that utilizes
dam/reservoir, projects
that build with grant
based on parties
negotiation (business to
business)
17. 17
INCENTIVES FOR RENEWABLE ENERGY
TAX ALLOWANCE IMPORT DUTY FACILITY
Gov’t Regulation No. 78/2019
183businesssegments
Eligible for tax
allowance, expanded
from 129 segments in
the previous
regulation.
30%ofinvestmentvalue
Reduction of corporate
net income tax for 6 years,
5% each year.
Under certain requirements
among others: investment value or
export orientation, manpower
absorption, local content.
Import duty on Machineries and
Equipments, goods, and raw materials for
production
• Exemption of import duty on machineries and
equipments
• 2 years exemption of import duty on raw
materials
• Additional 2 years import duty exemption for
raw materials if company using locally-
produced machineries and equipments (min
30%)
MoF Regulation
No.176/PMK.011/2009 jo. MoF
Regulation No.
76/PMK.011/2012 jo. MoF
Regulation 188/PMK.010/2015
TAX HOLIDAY
MoF Regulation No.150/PMK.101/2018
5-20years Tax relief facility, starting from
the commencement of
commercial production. Can be
extended for Max. 20 years
under certain consideration.
50-100%
Reduction of corporate income
tax for Pioneer Industry.
IDR
100billion
Minimum investment plan
MoF Regulation No.
66/PMK.010/2015
Import duty on Capital Goods
for Development and
Expansion of Power
Generation Industries for
Public Purpose.
Notes :
Power Plant < 1 MW 100% domestic capital
Power Plant 1-10 MW, Max 49% foreign capital
Power Plant > 10 MW, Max 95% foreign capital
INCENTIVE BECAUSE OF COVID-19 IMPACT
MoF Regulation No.86/PMK.03/2020 jo.
No. 110/PMK.03/2020
• Income tax PPh 21 borne by Government
• Import tax (PPh 22) exemption
• 30% reduction installment payment of PPh
25
• Incentive PPN
Investment
Facility period
year
2years
Relactation (tax reduction) after
facilticy period, with provisions:
25% for Investment 100-500
billion
50% Investment >500 billion
18. 18
• Indonesia Remain Commits to boost the utilization of
renewable energy
• The pandemic covid 19 brings contraction to economy,
demand of electricity and source of funding
• Some regulations, incentives and improvement in procedures
are taken and implemented
• Despite the challenges ahead, the opportunity is widely open
for investing in renewable energy sector in Indonesia
Concluding Remarks