AISERIES 2022

RENEWABLE ENERGY FOR INDONESIA

Cassiopeia Team
Ahmad Fahrezi (fahrezi190802.af@gmail.com)

Aditya Putranto (aditya.putranto01@ui.ac.id)

Amanda Lintang Cahyani (amanda.lintang@ui.ac.id)

 AISERIES 2022

Abstract
PT Akuo Energy is a renewable energy company which is committed to developing and
creating projects that use renewable energy and create social benefits for the surrounding area.
PT Akuo Energy Indonesia has ambitions to provide access to electrical energy to 1000 villages
that have limited access to electricity by finding solutions that present 3 aspects, namely
technical, economic and social aspects.
More details, PT Akuo Energy will build a power plant with energy that comes from
Solar PV in Batulanteh Village located in the Sumbawa Besar area. PT Akuo Energy will build
an off-grid power plant (using batteries as a storage area for electrical energy) located in Tepal
village, Tangkaplit, Baturotok, and Baodesa. Based on the research that has been done by PT
Akuo, the way to overcome the electricity problems that occur in this area is to design a PLTS
Off Grid electrical system with a capacity of 2000 kWp for PV and 4000 kWh for batteries
which will be distributed to 2811 families that spread over 7 clusters.

Background
Batulanteh Village is one of the villages located in the Sumbawa Besar Regency.
Batulanteh village is located at the foot of Mount Olet Sangenges with an area of 327.05 km2
with an altitude between 250 m to 800 m above the sea level. The electricity needs in the
Batulanteh Village area are still fully supplied by diesel generators, micro hydro generators and
pico hydro plants managed by local communities. Although 87% of the local population has
access to electricity, it can only be enjoyed at night. This is an obstacle for the people of
Batulanteh Village who need energy from morning to evening. The use of diesel generator sets
is considered quite expensive for the economic conditions of the local community, so it is
necessary to have other sources of electrical energy that can fulfill the needs of Batulanteh
Village.
Batulanteh sub-district has six villages with four villages located in the middle of the
mountains with limited access to electricity, which is Tepal, Tangkampulit, Baturotok, and
Baodesa. Each village consists of several hamlets, the hamlets are combined and divided into
seven cluster groups. The residents of Batulanteh Village have a relatively small amount of
energy consumption with the highest total daily electrical energy requirement for each head of
household is 3.54 kWh/day, while the lowest total energy consumption for each household is
1.14 kWh/day. Access roads to these villages have not been well built, so it is quite difficult to
pass, especially in rainy conditions. This makes distribution of sales of local commodity
 AISERIES 2022

products and the purchase of fuel to power diesel generators difficult. But besides that, NTB
has a very high solar technical potential, namely a theoretical potential of 20,243 MW and a
technical potential of 3,036 MW as well as the limited potential of other power plants that can
become competitors, making this PLTS project very promising for rural communities and
investors.
This is also supported by the growth of the “green energy” business in the Asian
continent. In the past three years, the world has seen more green unicorn companies. More than
25 green businesses have joined the global unicorn club, with a combined valuation exceeding
US$70 billion Increased investment activity of green startups. There has been a more than 67
percent increase in deals since 2018, with a total of US$2 billion invested globally in
sustainability-themed startups across more than 260 deals. Europe and North America are
currently leading the way in terms of investment size, with Asia quickly catching up.
McKinsey's analysis found that based on this potential, Asia could potentially see a tenfold
increase in startup activity over the next three to four years.

Problem Identification
Based on the background of the problem, the authors identify the problems that have
been faced by PT Akuo Indonesia using SWOT analysis.
Strength
- of the PT Akuo Energy project in Batulanteh Village has been supported by MCA
Indonesia.
- O&M costs are relatively cheaper unlike the PLTU which requires fuel cost.
- Off grid PLTS is very efficient if built in remote areas because it is easier to operate,
low operation, zero maintenance and panel components have a long technical life.
- The potential of PLTS in Indonesia is 207.8 GW, but only 0.02% has only been realized.
Weakness
- Very high initial investment cost.
- Energy storage is limited to battery capacity.
- Off grid PLTS cannot get energy at night and rainy conditions.
- The LCOE figure calculated by PT Akuo is still quite high, namely 0.22 cUSD/kWh
Opportunity
- The law on EBT has been issued in Indonesia and fully supported by the government
- PT Akuo Indonesia has received support from aMCA Indonesia
- A promising and also challenging target market because located in remote areas
 AISERIES 2022

- Consumers are aware of the benefits of electricity.

Threat
- Difficult access to the project.
- The licensing system is still not integrated step by step in one online system.
- The weakening of the rupiah exchange rate.
Based on the SWOT analysis, the writer can formulate the problem to be described in
this proposal, namely:
1. How to build an off-grid solar PV (PLTS) in accordance with the energy potential,
geographical conditions and economic conditions in the Batulanteh Village area?
2. How to determine the capacity and components to be used so that the off-grid solar PV
(PLTS) system can become an optimal generator?
3. How much does it cost to build the planned off-grid solar PV (PLTS)?
4. How can the off-grid solar PV (PLTS) system that was built can fulfill the economic
feasibility requirements?

Analysis and Solution

PESTLE
We are using PESTLE Analysis for off-grid solar PV (PLTS) development.

Political Factors
- The current government encourages the acceleration of solar PV (PLTS) development
through the large-scale solar PV (PLTS) and massive solar PV (PLTS) roof
development in various sectors.
- To achieve the goal of power plant projects in Indonesia, investors need to visit 10
Ministries/Institutions/Agencies.
- The government provides convenience for the private sector in the development of solar
PV (PLTS) through the provision of fiscal incentives and financial support.

Economic Factors
- The economy of Sumbawa Regency is still dominated by Agriculture, Forestry, and
Fisheries by 39.86%; followed by Wholesale and Retail Trade, Car and Motorcycle
Repair 16.25%; and Construction 12.17%.
- The inflation rate for the calendar year (January–May) 2022 is 2.56% and the year-on-
year inflation rate (May 2022 to May 2021) is 3.55%
 AISERIES 2022

- The government budget through the ministry of energy and mineral resources for the
rural electricity program is still quite limited.

Socio-Cultural Factors
- Based on data from the Sumbawa Regency Statistics Center 2020/2021, it is known that
the average education level of the Sumbawa community is elementary school with
49,657 students. Therefore, the education level of the Sumbawa community is quite
low. This relatively low level of education has an impact on the low awareness of the
use of electrical energy in Batulanteh Village considering that 87% of the population
has access to electricity but only at night.
- The majority of the people in Batulanteh Village are rice and herbal plants farmers , but
besides that the local community is also the largest producer of coffee beans in
Sumbawa such as Robusta Coffee and Arabica Coffee.
- The local economy in Batulanteh Village is also still very traditional because the
infrastructure is still inadequate.

Technological factors
- Off grid solar PV (PLTS) is a stand alone system that uses battery media to store
electricity availability.
- PT Akuo has carried out many power plant projects with renewable energy in various
countries and have a pilot project in Indonesia.
- The development of solar PV (PLTS) is one of the trends in the development of EBT
in Indonesia.
- Solar panel technology is no longer a common technology, therefore panel providers
will be easier to find so that the price of solar panels on the market varies.

Legal Factors
- The off-grid solar PV (PLTS) project is supported by the Minister of Energy and
Mineral Resources Regulation no. 12 of 2018 concerning alternative EBT power plants
in an effort to increase public access to electricity (especially 3T areas).
- Maximizing the use of renewable energy is also supported by Government Regulation
no. 79 of 2014
- Increasing the Capacity of Commercial on-grid and off-grid solar PV (PLTS)
infrastructure is regulated in the Minister of Energy and Mineral Resources No. 50 of
 AISERIES 2022

2017, Minister of Energy and Mineral Resources No. 53 of 2018 concerning Utilization
of Renewable Energy Sources for Power Supply. Electricity and Energy and Mineral
Resources Ministerial Regulation No. 38 of 2016 concerning Accelerated
Electrification in Undeveloped Rural Areas, Remote Areas, Borders, and Small
Inhabited Islands through the Implementation of Small-Scale Electricity Supply
Business

Environmental factors of
- Off-grid solar power plant (PLTS) are highly dependent on weather conditions, because
the intensity of the sun becomes an important component in the supply of electricity.
- Off-grid solar PV (PLTS) can reduce the disposal of environmental carbon emissions.
- Solar power plant (PLTS) can reduce dependence on the use of non-renewable fossil
fuels.
- Batulanteh Village has geographical conditions that are suitable for the construction of
solar power plant (PLTS) with very high solar technical potential, the theoretical
potential is 20,243 MW and technical potential is 3,036 MW

Based on the above analysis, LCOE value based on PT Akuo Indonesia’s calculation is
still above the average. This is a result of the very high costs which include the purchase of
equipment/technology, installation costs and project planning also preparation costs, the
planned electricity capacity factor is also quite large. It is therefore very important to
understand the concept of a particular cost component and its impact on the cost of generation.
To overcome this problem, we recommend using cheap solar modules that are sold in foreign
markets, you can also apply for a low interest loan and also apply for feasibility support or a
viability gap fund.

In principle, the supply of electricity by PT Akuo Indonesia is targeting 3T areas that

have not yet developed, so we feel that the local peoples are entitled to electricity subsidies, as
PLN as the electricity provider has a subsidized electricity price category. Based on data
provided by PT Akuo Indonesia, the highest energy requirement for each household is 3.54
kWh/day and the price of electricity per kWh for this system is Rp. 3,243, -. When compared
with the price of subsidized electricity by PLN (only around Rp. 1,352,-/kWh), for the principle
of public justice, an electricity fee of Rp. 1,352 x 3.52 kWh = Rp. 4,759, while the remaining
 AISERIES 2022

Rp. 11,415, can be allocated from local government subsidies. . We think that subsidized tariffs
by local governments can motivate people to subscribe to electricity.

In addition, the author also recommends that PT Akuo Indonesia Cooperate with the
local government in providing intelligence about the benefits of electric energy to the economy
as well as providing examples of the use of electrical energy in managing local commodity
products, such as coffee plantations that are integrated with solar power projects. To support
the circular economy, PT Akuo Indonesia can also involve local workers in project
development and provide power plant management to local residents. For local infrastructure
development, PT Akuo Indonesia can also work with local governments to build a road by
providing feedback to the local government in the form of new jobs during the power plant
installation process and also when the power plant is in operation. In addition, feedback given
to local governments also includes economic development due to the easy access of roads to
villages. To use the excess electrical energy produced by solar PV (PLTS) during the day, a
battery can be used which can store the excess electrical energy. The battery can replace the
work of the diesel generator which is used as backup energy.

The implementation of the project is expected to be through a scheme for providing

electricity by a business entity that has its own business area based on the Regulation of the
Minister of Energy and Mineral Resources Number 28 of 2012 concerning Procedures for
Application for a Business Area for the Provision of Electricity for Public Interest. With this
power plant, it is hoped that it will encourage the community's economy because of easy access
to energy, so that people can process the raw materials they have, along with economic growth,
purchasing power will also increase so that the local government has the capital to build good
infrastructure for Batulanteh village.

Conclusion
Based on the background, problem identification, and analysis that has been done by the author,
it can be concluded that PT Akuo has many opportunities in the development of this project,
ranging from supportive environmental factors and consumers who are aware of the benefits
of electricity. In addition, PT Akuo is also supported by several government regulations
regarding the construction of PV mini-grid. On the other hand, PT Akuo has to face many
challenges, first of which lies in inadequate access to infrastructure and the high cost of
development.
 AISERIES 2022

Suggestion and Advice

Suggesting PT Akuo to use cheap solar modules sold in foreign markets, it could also be by
applying for a low interest loan and also applying for feasibility support or a viability gap fund.
The author believes this strategy will reduce the LCOE value by 20%-41.6%. To increase the
public's willingness to pay to subscribe the electricity, the authors suggest subsidizing
electricity tariffs, as PLN as an electricity provider has a subsidized electricity price category.
The project implementation is expected to be through a scheme for providing electricity by
business entities that have their own business areas based on the Minister of Energy and
Mineral Resources Regulation No. 28 of 2012.

References
- Sulistyo, E., 2022. PLTSa di Era Ekonomi Sirkular. [online] Solopos.com. Available
at: <https://www.solopos.com/pltsa-di-era-ekonomi-sirkular-1280442> [Accessed 11
August 2022].
- Eprints.umm.ac.id. 2022. [online] Available at:
<https://eprints.umm.ac.id/40457/3/BAB%20II.pdf> [Accessed 11 August 2022].
- 2022. [online] Available at:
<https://www.kompasiana.com/nicholasarga/61174a426e7f0137aa36b663/dampak-
penggunaan-plts-terhadap-lingkungan> [Accessed 11 August 2022].
- Rachman, F., 2022. Cek di Sini! Daftar Tarif Listrik Terbaru 27 Juni 2022. [online]
detikfinance. Available at: <https://finance.detik.com/energi/d-6148688/cek-di-sini-
daftar-tarif-listrik-terbaru-27-juni-2022> [Accessed 11 August 2022].
- 2022. [online] Available at: <https://www.mckinsey.com/featured-insights/future-of-
asia/seizing-green-business-growth-for-asias-energy-players> [Accessed 11 August
2022].
- Iesr.or.id. 2022. [online] Available at: <https://iesr.or.id/wp-
content/uploads/2019/05/Proceeding-PE-11.pdf> [Accessed 11 August 2022].
- Ebtke.esdm.go.id. 2022. Direktorat Jenderal EBTKE - Kementerian ESDM. [online]
Available at:
<https://ebtke.esdm.go.id/post/2020/11/27/2710/kunjungi.plts.terbesar.se-
 AISERIES 2022

asia.tenggara.dirjen.ebtke.sampaikan.insentif.fiskal.dan.dukungan.pembiayaan?lang=i
d> [Accessed 11 August 2022].
- Drive.esdm.go.id. 2022. [online] Available at:
<https://drive.esdm.go.id/wl/?id=LywF3lwAFv4vjOBJMVvoRkd03FxBwTJ2&mode
=list&download=1> [Accessed 11 August 2022].
- Hanung, A., 2022. Menimbang Aturan Baru Terkait Skema Harga Listrik EBT -
Halaman 3. [online] CNBC Indonesia. Available at:
<https://www.cnbcindonesia.com/news/20180525141148-4-16595/menimbang-
aturan-baru-terkait-skema-harga-listrik-ebt/3> [Accessed 11 August 2022].

Appendices

1. Indonesian LCOE chart with various changes in cost components and the impact of
implementing certain policies.

2. Solar Technical Potential Table

AISERIES 2022
 AISERIES 2022

3. Table of Average Education in Sumbawa

4. Renewable Energy Potential Chart

AISERIES 2022
 AISERIES 2022

5. Project plans PT Akuo Indonesia on Batulanteh District

6. Electrification Ratio Chart

7. PT Akuo Indonesis Energy Production Outlook