Indonesia Renewables Report Q1 2013Published by: Business Monitor International Published: Jan. 16, 2013 - 33 Pages Table of Contents
AbstractBMI View: We have revised down our 2013 growth forecast for non-hydro renewable generatingcapacity due to delays in several geothermal projects. We believe these delays will affect geothermalprojects in the future, and have slightly revised down our long-term forecasts. Despite the downwardrevision, we still believe that geothermal energy will continue its dominance in Indonesia's renewablesector, but it will be a stretch for the government to meet its geothermal targets. Additionally, we havestarted incorporating solar capacity into our renewable forecast following the announcements of variousgovernment and private solar projects in late-2012.We have revised down our 2013 growth forecast for non-hydro renewable generating capacity inIndonesia from 16.8% to 12.8%. This is due to a downward revision in geothermal capacity. We have also revised down our long-term growth forecasts for non-hydro renewable capacity, and nowexpect growth to average 12.9% per annum between 2013 and 2021 (down from 13.2%). Despite thisrevision, our forecasts remain relatively sanguine as we expect electricity consumption and the country'scostly reliance on fuel imports to drive renewables growth. Here are the key trends and regulatory changes in the industry: The government extended the feed-in tariff (FiT) scheme to include hydropower and biomassapplications through Ministerial Regulation 04/2012. The scheme applies to projects withcapacities below 10MW, and offers differentiated rates based on location and technology. On July 18 2012, the Indonesian government raised the FiT for geothermal power plants fromUS$0.097 per kilowatt hour (kWh) to between US$0.10 and US$0.17/kWh. The governmentannounced that it would provide IDR2trn (US$213mn) of loans to finance geothermal projectsundertaken by IPPs or the state utility. This reflects the challenge that Indonesia is facing inattracting private investors and power providers to enter the country's geothermal sector. Indonesia will receive a new commercial-scale wind farm, bringing the tally to two. However,we do not expect wind energy to play a large role in Indonesia's energy mix, as geothermal willbe more attractive than wind energy. Get full details about this report >> |
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