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SMALL HYDRO POWER PLANT

A GUIDE FOR DEVELOPERS


& INVESTORS IN INDONESIA

By Ifnu Setyadi G

AGUSTUS 2017
GLOBAL SITUATION
Worldwide, Hydropower is a crucial power supply.
Contributing about 16.6% of global electricity. (end 2014)

Sources : Renewables 2015 Global Status Report. REN 21


GLOBAL SITUATION
IN 2014
Globaly, Hydropower growth significant since 2011.
The contribution rose from 3.7% to be > 16%

END 2013 END 2014


Investment flow in ENERGY SECTOR

Since 2011, investment in developed economic country decrease.


Other side, investment in developing country increase & in 2014 slightly to the same
Throughout 2014, renewable energy investment continued to spread to new
markets. Chile, Indonesia, Kenya, Mexico, South Africa, and Turkey each
invested more than USD 1 billion in renewable energy
INSTALLED CAPACITY

- 100 KW
100 KW 1 MW
1 MW - 10 MW
10 MW - 50 MW
> 50 MW

IN INDONESIA
HYDRO POWER SCHEME
FOR RURAL ELECTRIFICATION

PURPOSE :

- TO PUSH ELECTRICATION IN RURAL AREA


- TO OPEN ISOLATED AREA

SUPPORTED BY GOVERNMENT

ACTIVITIES
A. DEVELOP NEW SITE
B. REHABILITATION
C. TO IMPROVE SERVICE
COMERCIAL SCHEME
DEVELOPMENT

IPP (INDEPENDENT
POWER PRODUCERS)

SELF USAGE
HYDRO POWER POTENTIAL
IN INDONESIA
The harnessing of water power is still small,
just 19% of potential sites that it success identified.
Much more sites is waiting to exploit.

Hydropower Potential
75.000 MW

Installed Capacity
Identified Potential 8.671 MW
around 1500 sites
45.379 MW
19%
61%
Sources : Statistik EBTKE 2014
IN INDONESIA
Hydropower is still small contribute to Energy Mixed in Indonesia

IPP shares 23.30%


Hydro 4.88%
Diesel Rent
9.81%

Coal 39.05%
Gas 2.38%

Geothermal
Diesel, gas 1.87% Produced by PLN
Engine, PV,
Wind 2.03%
Gas + Steam 16.66%

Produced by PLN Total Production

Sources : Statistik PLN 2014


IN INDONESIA
Indonesia have huge potential of hydro power.
Hundreds license was issued but the project realization is not significantly.
However, the Indonesian Government has committed to increase
the use of renewable energy to 23% by 2025.

The Indonesian Government has also set out in


its Blue Print of National Energy Implementation Program 2005-2025
the following renewable energy generation capacity targets
to be achieved by 2025:

- Geothermal energy: 9,500 MW


- Small-scale hydropower: 500 MW (on-grid); 330 MW (off-grid)
- Solar energy: 80 MW
- Biomass energy (for power generation): 810 MW
- Wind energy: 250 MW (on-grid); 5 MW (off-grid)
IN INDONESIA
Restrictions/Incentives on Foreign Investments
CURRENT SITUATION

The laws in Indonesia allow foreign investments, in forms of direct ownership


or joint venture, by incorporating a limited liability company with the
Indonesia Investment Coordinating Board.

Restrictions on foreign direct investment are outlined in The Presidential


Decree No. 36 of 2010, which specifies all restrictions in a Negative List,
which such investment is allowed subject to the following limitations:
a. foreign ownership in companies in the business any kind of power
generation with a capacity in excess of 10 MW or power transmission
or distribution shall not exceed 95%;
b. development of small-scale power plant with capacity between 1 MW and
10 MW are required to form a local partnership with a small enterprise;
the maximum foreign ownership shall not exceed 49%
c. development of power plant with a generation capacity of less than
1 MW is restricted (reserved for micro, small, medium enterprises and
cooperatives).
IN INDONESIA
Feed in Tariff (FIT) by MEMR Regulation 19/2015
CURRENT SITUATION

Utilizing river Year 1 8 Year 9 20


flow USD12 cents x F USD7.5 cents x F
MEDIUM
VOLTAGE
20 KV (UP
TO 10 MW) Utilizing
multipurpose Year 1 8 Year 9 20
dams or USD 10.8 cents x F USD 6.75 cents x F
irrigation

F is index factor based on site project location :


a. Jawa, Bali, Madura F=1
b. Sumatera F = 1.1
c. Kalimantan, Sulawesi F = 1.2
d. NTT, NTB F = 1.25
e. Maluku, Maluku Utara F = 1.3
f. Papua, Papua Barat F = 1.5
IN INDONESIA
CURRENT SITUATION

Tariff by MEMR Regulation 50/2017

BPP setempat >


BPP setempat < BPP
Utilizing river BPP Nasional
Nasional
flow Tarif max. BPP
Tarif = Kesepakatan
MEDIUM setempat
VOLTAGE
20 KV (UP
TO 10 MW)
CF > 65% CF > 65%
Notes :
Skema BOOT Skema BOOT
IN INDONESIA
CONSTRAIN THE IMPLEMENTATION
CURRENT SITUATION

MEMR Regulation 50/2017


1. Proses penetapan tarif pada dasarnya adalah negosiasi B2B.
- Perlu adanya tools untuk menghitung tarif yang seragam, penetapan
parameter perhitungan kelayakan (BEP, Inflasi, eskalasi OM,
besaran resiko investasi dalam menetapkan batas layak IRR,
komponen biaya O&M, depresiasi, besaran pajak, dll)
- Teknis pengaturan operasi ada penetapan produksi energi dan
kVAR, hal ini menyulitkan teknologi turbin-generator dalam negeri
untuk menjamin kapasitas/efisiensi/performance
2. Skema Investasi BOOT
- Perlu rincian skema BOOT yang dimaksud adalah pengambilalihan
saham IPP, atau pengambilalihan aset saja
- Perlu rincian skema BOOT pada area proyek yang berupa pinjam
pakai kawasan hutan, kerjasama pemanfaatan lahan
Perhutani/PTPN/Swasta.

3. CF 65% potensi energi terbangkit besar, kendala di lapangan power


evacuate sehingga perlu adanya GI Penampung. (Koordinasi PLN
P3B & PLN Distribusi Wilayah) sehingga CF menjadi turun.
IN INDONESIA
CURRENT SITUATION

Average Production Cost of PLN

Average Selling Price of PLN


Feasibility Level of HEPP in Indonesia

1. Not attractive (Feasible) : PI > 1, BEP 8 11 years,


IRR12% 14% (interest rate 11% -13%), investment cost
IDR 25 -35 M/MW (USD 2 2.5 millions/MW)

2. Moderate (Feasible) : PI > 1, BEP 7 8 years,


IRR14% 16% (interest rate 11% -13%), investment cost
IDR 20 - 25 M/MW (USD 1.5 2 millions/MW)

3. Attractive : BEP 5 6 years, IRR 17% 20%,


investment cost IDR 18 20 M/MW
(USD 1.3 1.5 millions/MW)

3. Very Attractive : BEP 4 5 thn, IRR >20%, investment


cost IDR 15 18 M/MW (USD 1.1 1.3 millions/MW)
Typical Site of HEPP
1. Moderate (just Feasible) :
- Installed Capacity 2 3 MW, water way around 1 km to
meet head 25 - 40 m, CF 0.65
- Installed Capacity 3 6 MW, water way 2 3 km to meet
head 30 40 m, CF 0.65

1. Attractive : Installed Capacity 4 6 MW, water way


in 1-2 km to meet head 35 - 60 m, CF 0.65 0.7

2. Very Attractive : installed 7 10 MW, water way


in 1-2 km to meet head > 40 m, CF 0.65 0.7
Note :
Installed Capacity for 2< MW is not attractive. Investor developed small
size to get project experiences. Its important to make easy access for
project financing.
Head & Waterway correlation
IN INDONESIA
THE CURRENT COST

Development Cost
& Others
License,
FS& DED, Land,
Civil Works 14%
Project Management,
Tax
E&M IDC
58% 28%

5 10 AVERAGE INVESTMENT COST AROUND


MW USD 1.65 MILLIONS/MW, USD 1 = IDR 13500
35 AVERAGE INVESTMENT COST AROUND
MW USD 1.8 - 2 MILLIONS/MW, USD 1 = IDR 13500
13 AVERAGE INVESTMENT COST AROUND
MW USD 2 2.5 MILLIONS/MW, USD 1 = IDR 13500
E&M COST OF INVESTMENT EQUIPMENT COST

IRENA 2012 BASED EUROPEAN PRODUCT

INDIAN TURBINE GENERATOR WATER TO WIRE


5 10 MW : USD 350.000 400.000/MW
3 - 5 MW ; USD 500.000 650.000/MW
O&M COST STRUCTURE
IN INDONESIA
OPERATIONAL COST SMALL HYDRO POWER IN INDONESIA*
* Yearly Operation
NO DESCRIPTION VOLUME UNIT PRICE INDEX AMOUNT REMARK

1 STAFF
a. Plant manager 1 person 6,000,000 13 78,000,000
b. Operator 6 persons 2,500,000 13 195,000,000 3 shifts x 2 persoons
c. Mechanical Technicians 1 person 3,500,000 13 45,500,000
d. Electrical Technicians 1 person 3,500,000 13 45,500,000
e. Administration & Finance. Acc 1 person 3,500,000 13 45,500,000
f. Security and OM Staff 10 persons 2,500,000 13 325,000,000
- Security (4 staf) 2 shifts x 2 persons
- Inspection team (4) 2 shifts x 2 persons
* Weir Gate + Waterw ay (2)
* Head Ponds + Water w ay + Penstock (2)
- Service Support (2)
* Building & Civil Foreman (1)
* Driver (1)
g. Insurannce 20 persons 500,000 12 6,000,000 Health and Injure
2 CIVIL MAINTENANCE /YEAR 1.25% - 1 - Based on Civil Investment
0.6% (< 5 years), 1.3% ( 5 - 25 years), 1.9% >25
years old
3 E&M MAINTENANCE/YEAR 1.50% - 1 - Based on E&M Investment
range 1-2% of Installed Cost depend of Capacity
4 Administration
a. Office and Stationary 1 ls 500,000 12 6,000,000
b. Coordination and Communication 1 ls 2,500,000 12 30,000,000
c. Car, fuel, service 1 ls 2,500,000 12 30,000,000

Cost Operation (1 + 4) 806,500,000


BOD Cost Operation for Supervising & Monitoring 30% 241,950,000 USD
Total Fixed Cost / Year IDR 1,048,450,000 77,091.91
O&M COST STRUCTURE
IN INDONESIA

FIXED COST YEARLY O&M COST


OPERATIONAL
FOR 5-10 MW, AROUND
USD 75000-8000/PLANT
1.5% - 2% OF INVESTMENT COST
CIVIL WORKS USD 0.006/kWh
MAINTENANCE
1.25% OF CIVIL WORKS
INVESTMENT COST FOR 3-5 MW, AROUND
2 2.5 % OF INVESTMENT COST
E&M MAINTENANCE
USD 0.008/kWh
1.5% OF E&M
INVESTMENT COST
O&M COST STRUCTURE
IN INDONESIA
GENERAL CONDITION :

A. Jawa
1. Potensi cukup besar dan masih banyak yang dapat dikembangkan.
2. Power Evacuate bermasalah. Perlu uprating dan perluasan jaringan
3. Banyak lokasi PLTM yang tertunda dibangun sampai kondisi
kelistrikan setempat lebih baik
- Garut, Sukabumi, Banten terbatas untuk pembangunan
- Sebagian Cianjur Selatan masih memungkinkan dikembangkan
dan sebagian tidak bisa dibangun karena persoalan power evacuate
- Jawa Tengah secara umum untuk kapasitas > 3 MW mengalami
kendala penyerapan beban
- Potensi di Jawa Timur sangat terbatas
O&M COST STRUCTURE
IN INDONESIA
GENERAL CONDITION :

B. Lampung
1. Potensi terbatas, tarif berdasar BPP rendah. Sehingga hanya sedikit
lokasi yang menarik untuk dikembangkan.
C. Sumatera Selatan
1. Potensi terbanyak di daerah bukit barisan (Lahat, Muara Enim, Ogan
Komering, Pagar Alam)
2. Penyerapan beban sangat rendah
3. Perlu dibangun Gardu Pengumpul
D. Bengkulu/Jambi
1. Kapasitas relatif kecil antara 2 4 MW
2. Penyerapan beban sangat rendah
E. Sumatera Barat
1. Kapasitas bervariasi 2 10 MW
2. Kendala penyerapan beban
3. Perlu di bangun Gardu Pengumpul
O&M COST STRUCTURE
IN INDONESIA
GENERAL CONDITION :

F. Sumatera Utara
1. Potensi sangat besar untuk kapasitas 2 10 MW.
2. Lokasi PLTA sangat banyak dan tersebar ( 20 50 MW)
3. Penyerapan beban rendah
4. Perlu dibangun Gardu Induk Pengumpul agar penyaluran beban
lebih baik.

G. Aceh
1. Kapasitas pembangkitan bervariasi dari 2 10 MW
2. Beberapa lokasi memiliki kapasitas besar 20 200 MW
3. Kapasitas penyerapan beban rendah, jaringan PLN terbatas, GI
terbatas
H. Sulawesi
1. Kendala dalam pengembangan kapasitas 3 10 MW adalah
penyerapan beban, karena sistem belum interkoneksi secara penuh.
2. Beberapa lokasi berpotensi PLTA 50 200 MW, yang sulit dalam
penyaluran beban
O&M COST STRUCTURE
IN INDONESIA
GENERAL CONDITION :

I. Bali - NTB - NTT


1. Kapasitas pembangkitan kecil 500 kW 2 MW.
2. Kondisi air bermasalah, CF < 0.6
3. Gangguan Downtime PLN masih tinggi

G. Kalimantan
1. Lokasi pengembangan terbatas di pedalaman
2. Kapasitas PLTA memungkinkan dibangun, persoalan adalah
penyaluran daya karena jauh dari pusat beban.
3. Kapasitas PLTM di lokasi yang dekat permukiman/kota besar relatif
kecil 500 kW 2 MW karena head rendah

H. Papua
1. Potensi besar di pegunungan tengah.
2. Kondisi geologi tidak mendukung (sedimentasi pasir, lumpur, batu)
3. Potensi di dekat pusat beban sangat terbatas
4. Infrastruktur terkendala (angkutan udara membatasi berat mesin)
Thank You!
Salam !