Investor Presentaiton

REGULATION MEMR Reg. No. 10/2018: Improvements on PPA regulation but some risks to private investors Jan 2017 MR No.10/2017 Negatively viewed by private players: BOOT scheme, risk allocation, tougher penalties, restricted transfer of ownership before COD. Aug 2017 MR No.49/2017 More positive response: Revocation of government force majeure. Feb 2018 MR No.10/2018 Revocation of changes in law and regulation force majeure. The Ministry Regulation No.10/2018 which amended the Ministry Regulation No.10/2017 revokes the government force majeure (FM) from the clauses, providing more contract certainty for IPPs. However, other major issues such as the risk allocation of natural FM, BOOT scheme, and penalty for IPPs remain. At this situation, PLN is not required to pay termination payments when natural FM causes long-term interruptions. PLN, instead, may extend the PPA by the length of time of disaster. Nevertheless, it is important to note that this regulation excludes the intermittent renewables (solar and wind), small hydro (<10 MW), biogas, and waste to energy power plants. IESR (Institute for Essential Services Reform) | www.iesr.or.id 20 20

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