Investor Presentaiton
2019 OUTLOOK
Renewables development is likely slowing down, waiting for
better policy and regulatory framework
Geothermal exploration activities will be likely declining due to unfavored policy and regulatory framework stipulated in MEMR Regulation
No. 48/2017 and No. 50/2017. Exploration and construction will be limited to existing fields. The survey and pre-exploration activities in fields
owned by PLN and other six companies will also remain limited.
Despite the huge potential of solar PV (on-grid and off-grid) to replace or reduce the use of diesel power plants, we expect to see limited new
utility-scale solar projects in 2019 due to PLN's procurement process and the ability of grid to integrate more solar PV into the network. The
technology costs, electricity generation cost (BPP), low cost financing, and procurement process are key factors that affect solar projects in
Indonesia.
The growth in rooftop solar PV will be modest and concentrated in Jabodetabek areas due to unfavored conditions stipulated in MEMR
Regulation No. 49/2018 and the absence of financial support or incentives for households. There is however potential in rooftop development
for industrial estate/areas where the electricity is not supplied by PLN.
New utility scale wind projects are not expected to start in 2019, including the second unit of Sidrap wind farm. The slow development of wind
power is due to policy and regulatory barriers, as well as the grid capacity and readiness of PLN's system to address intermittency challenges.
IESR (Institute for Essential Services Reform) | www.iesr.or.id
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