IEEJ：August 2016 © IEEJ2016

THE MINISTRY OF ENERGY AND MINERAL RESOURCESDIRECTORATE GENERAL OF ELECTRICITYINDONESIA ELECTRICITY POLICYJICA TRAINING ENERGY POLICY

AHMAD AMIRUDDIN
Participant from Indonesia

IEEJ:August 2016

IEEJ：August 2016 © IEEJ2016

OUTLINE
1 ELECTRICITY DEVELOPMENT POLICY
2 CURRENT STATE
3 ELECTRICITY CHALLENGE
4 DEVELOPMENT PLANIEEJ：August 2016 © IEEJ2016

1ELECTRICITY DEVELOPMENT POLICY (1)The Objective
To ensure the availability of electricity in sufficient quantity, good quality andreasonable price in order to increase the welfare prosperity of the people.

2Control and Business Electricity provision shall be under the control of the state, which is provided by theGovernment and the regional governments under the principle of regional
autonomy.
 The conduct of electricity provision business by the Government and the regional
governments shall be conducted by state-owned enterprise and region ownedenterprise.

 Private business entity, cooperative and self-supporting community may participate
in the business of electric power supply.
 The Government and/or regional governments authorized to allow opportunities toregion owned enterprise, private entities, or cooperatives to conduct integrated
electricity provision business in areas where power service is not yet provided.
DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

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ELECTRICITY DEVELOPMENT POLICY (2)Utilization Of Primary Energy Source Primary energy sources shall be used optimally in accordance with the National
Energy Policy to ensure the sustainability of electricity supply.
 Shall be carried out by prioritizing the new and renewable energy sources.
 Domestic primary energy sources shall be prioritized for national electricity interest.

4 Funding
For the supply of electric power, the Government and regional government shall makeavailable certain amount of fund for:

 low income group of community; electric power supply facility in undeveloped regions;
 electric power generation in isolated region and at border area; and rural electricity.

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

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ELECTRICITY DEVELOPMENT POLICY (3)General Plan for Electricity
 General Plan for National Electricity(RUKN) shall be prepared on the basis
of National Energy Policy andestablished by the Government afterconsultation with the parliament.

referring

Parliament

consultation

 RUKN shall be prepared with theparticipation of regional government.
 General Plan for Regional Electricity(RUKD) shall be prepared on the basisof General Plan for National Electricity(RUKN) and established by theGovernment after consultation withRegional Parliament.

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESRegional
Gov’t

NEP

discussion

RUKN
referring

RegionalParliament

consultationRUKDRUPTLIEEJ：August 2016 © IEEJ2016

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ELECTRICITY DEVELOPMENT POLICY (4)Power Generation Development
 To meet the realistic demand growth, address the lack of electricity supply in someareas, increase reserve capacity and to fulfill reserve margin.
 Reduce oil share from energy mix.
 More new and renewable energy sources (e.g. Hydro, geothermal, solar, Bio-fueland wind power).
 utilizatioan of clean power generation technology (e.g. Super Critical technology,Carbon Coal Storage technology).

7 Transmissiion and Distribution Development
 To meet the power system growth and increase system reliability.
 Can be developed by the private sector.

 The operation of the transmission network must be open access (opportunities forpower wheeling).

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

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ELECTRICITY DEVELOPMENT POLICY (5)Tariff and Subsidy
 MEMR as the regulator to keep the supply of electricity is carried out efficiently andmaintain the balance of interests of the electricity provider (PLN) and consumers.
 Evaluate the Cost of Power Supply, with the principle of Allowable Cost andmaximize efficiency through diversification of primary energy and reduction ofpower losses.
 Electricity subsidy is prioritized for indigent community groups/consumers (thepoor), tariff for other consumer is set to be economical.

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

MANAGEMENT OF ELECTRICITY PROVISIONCONTROL••

STATE
GOVERNMENTREGIONAL GOVERNMENT

Regulation, policy, standard
Provides funding for:
 Low income society Development of electricity supply infrastructure inundeveloped regions Development of electricity in remote and border areas
 Development of rural electricity

BUSINESSELECTRICITY BUSINESS LICENSE HOLDERSTATE-OWNEDENTERPRISE*REGION-OWNEDENTERPRISE*** : First Priority** : Given the opportunity as integrated electricity
business license organizer for not electrified areas
DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESPRIVATEENTITIES**

COOPERATIVES**SELF-RELIANT
COMMUNITIES**IEEJ：August 2016 © IEEJ2016

MINISTRY / RELATED AGENCIES IN THE DEVELOPMENT OF NATIONAL ELECTRICITY

COORDINATING MINISTRYFOR ECONOMIC AFFAIRSCOORDINATING MINISTRYFOR MARITIME AFFAIRSINVESTMENT COORDINATINGBOARDMINISTRY OF ENERGY AND
MINERAL RESOURCES

Government guarantees

Principle permits for foreign
investment & One Stop
Service Center (PTSP)

Technical Policy and Regulation

The business license ,construction license,
Forest Land Borrow and
Use Permit (IPPKH)
Recommendations andsupport land acquisition

MINISTRY OF ENVIRONMENTAND FORESTRY
Forest Land Borrow and Use
Permit(IPPKH) &Environmental Impact
Assessment (AMDAL)MINISTRY OF
TRANSPORTATION
Permission of the jetty, coalshipping, and the use ofrailway lines

NATIONAL DEVELOPMENT
PLANNING AGENCYMINISTRY OF AGRARIAN ANDSPATIAL

BluebookpublishingLand acquisition andcertification

MINISTRY OF FINANCE

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESLOCAL GOVERNMENTIEEJ：August 2016 © IEEJ2016

INDONESIA’S ELECTRICITY STATE IN 2015
PLN
70%

INSTALLED CAPACITY OF POWER GENERATION

55,528 MW

55,528MW

PPU
4%
Non-Oil Captive
5%
INSTALLED CAPACITY

PLN: 38,310 MW IPP: 12,477 MW PPU: 2,349 MW IO non BBM: 2,392 MW

ELECTRICITY PRODUCTION

ELECTRICITY CONSUMPTION

283 TWh228 TWh

ELECTRIFICATION RATIOkWh PER CAPITA

88,30 %

910 kWhLENGTH OF TRANSMISSION LINELENGTH OF DISTRIBUTION LINE49.325 kms

925.312 kms

IPP
21%

RE
11%
COAL
50%283TWhGAS
25%

OIL
14%
ENERGY MIX *)PUBLIC
6%
RESIDENTIAL
22838%

INDUSTRYTWh 40%

BUSINESS
16%
ELECTRICITY CONSUMPTION *)DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCES*) Included Non-PLN

IEEJ：August 2016 © IEEJ2016

ELECTRICITY SECTOR CHALLENGES

1. INCREASE kwh PER-CAPITA Thought electricity consumption (kWh) per-capita of Indonesia is always increased,
however it is still low -only 910 kWh in 2015 ( Compared to other ASEAN countries,
was lower than Brunei Darussalam, Singapura, Malaysia, Thailand, and Vietnam).
 kWh per-capita target needs to be achieved: 2,500 kWh by 2025 (NEP).
2. INCREASE ELECTRIFICATION RATIO National electrification ratio is still lower (88.30%) compared to other ASEAN
countries.
 Electrification ratio target needs to be achieved: 97,35% by 2019.
3. INCREASE ELECTRICITY SUPPLY Due to electricity supply is not enough to meet demand in some region, has
impacted to routine blackout and new customer restrictions are applied by PLN.
 Additional power plants are necessary to be developed.
4. INCREASE RURAL ELECTRIFICATION RATIO National rural electrification ratio was 96.94% in 2014.
 There are 12,659 villages without electricity access or having minimum of electricity
supply.
 Rural electrification ratio target needs to be achieved: 100% by 2020.
DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

ELECTRICITY DEVELOPMENT PLAN
ASSUMPTION AND PROJECTION (2015-2034)

DRAFT OF RUKN 2015-2034

YEAR
DESCRIPTIONASSUMPTION & TARGETEconomic Growth *)Inflation**)Population Growth ***)
Electrification Ratio
PROJECTION RESULTElectricity Demand
Electricity Consumption
Per Capita
Electricity Demand Growth
Elasticity
Additional Capacity (Cumulative)
Power Generation Capacity(Nett Capacity)

UNIT2015

2019 2020 2024 2025 2029 2030 2031 2034%%%%

5.7
8.0
8.0
5.0
3.5
3.5
1.3
1.2
1.1
87.35 97.35 99.35

8.0
3.51.0100

8.0
3.5
0.9
100

7.6
3.50.8100

7.5
3.5
0.7100

7.4
3.5
0.7
100

7.3
3.4
0.6
100

TWh239

347

558

616

776

819

865

1,017

kWh935

1,293 1,407 1,977 2,161 2,636 2,764 2,898 3,347

%
GW

9.3
1.6
8

10.0
1.3
38

10.1
1.3
47

10.0
1.3
94

10.3
1.3
108

5.7
0.8
150

5.6
0.7
161

5.6
0.7
173

5.6
0.8
211

GW

57

8290

132

146

183

194

204

240

381

Source:*)APBN-P 2015, RPJMN 2015-2019, National Energy Policy**)
APBN-P 2015, RPJMN 2015-2019, regression with economic growth***)Projection to Indonesia Population 2010-2035 (Bappenas-BPS-United Nation Population Fund), 2013****) not cumulative

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCES

AVERAGE2015-2024 2015-2034
7.7
3.8
1.1

7.6
3.6
0.9

9.9
1.3
9.4 ****)

7.91.1
10.6 ****)IEEJ：August 2016 © IEEJ2016COMPOSITION OF ENERGY SUPPLYFINAL ENERGY MIX(National Energy Policy, GR No.79/2014)

6%23%30%

41%

23%

22%30%

25%

REALIZATION 2013

TARGET 2025

ENERGY MIX OF POWER GENERATION(Draft of RUKN 2015-2034)

12%

25%
24%

53%
11%

REALIZATION 2014
DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCES

50%1%24%TARGET 2025

New and REOilGasCoal

IEEJ：August 2016 © IEEJ2016

35.000 MW PROGRAM –NECESSARY TO ADDRESS CHALLENGES• To meet the high growing demand of electricity (8.7% per year) in order to increase national economic
growth that is targeted to reach about 7% in 2019.
• To meet kWh per-capita that is targeted to reach 1,293 kWh in 2019.
• To meet electrification ratio that is targeted to reach 97.35% in 2019.
20152019

Installed capacity of generation (GW)

55.5

98.4

Economy growth (%)

4.77

kWh per-capita (kWh)

910

1.293

Electrification ratio (%)

88.30

97.35

DISTRIBUTION OF 35,000 MW PROGRAMDIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

PROGRESS 35.000 MW PROGRAM(April 2016)
Perencanaan
Plan

223
0.6%

Procurement
Pengadaan

TOTAL
3,742
10.5%

12,22734.4%

10,941
30.8%
220
2.1%

PLN

Sudah
PPA, prosesPPA Signed/
Financial Closed
Financial Close
Konstruksi& Komisioning
Construction
and Commissioning
COD/SLO
COD/SLO

8,378
23.6%

547
2.2%

30.0%

3,195
30.1%

10,941
44.0%

5,526
52.0%
1,680
15.8%

6,697
26.9%
Power-plants that have been COD/SLO:
Sulawesi
1. MiniHPP Taludaa (IPP) 3 MW
2. GTPP Gorontalo Peaker (PLN) 4 x 25 MW
3. GTPP MPP Amurang (PLN) 120 MW

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCES

6,701
26.9%

Total : 223 MWIPPIEEJ：August 2016 © IEEJ2016

BREAKTHROUGH TO ACCELERATE 35,000 MW DEVELOPMENT PROGRAMOBSTACLES

SOLUTION

Land Acquisition

Implement Law No 2/2012 and Presidential Regulation No. 4/2016

Price Negotiation

Establish the ceiling price for IPP and Excess Power(MEMR Regulation No.3/2015 )Procurement of power generationfrom IPP

Accelerate procurement process through “Direct Appointment & Direct Selection”
for renewable energy, mine mouth, marginal gas, expansion, & excess power(MEMR Regulation No.3/2015)

Permitting process

Establish “One stop service on permitting” at BKPM (Investment Coordinating Board)(MEMR No. 35/2014)

Developer & Contractor
Performance

Conduct “Due Dilligence” to developer and contactor, both of technical and financial
aspects (MEMR Regulation No.3/2015)

Project Management

Establish Independent Procurement Agent for Procurement, Project Management Office(PMO) in PLN & UP3KN in MEMR (MEMR Regulation No. 3/2015 and MEMR Decree No.
3066 K/73/MEM/2015)

Coordination
Across Sectors

Establish National Team Across Ministries(Coordinating Minister for Economic Affairs Decree No.129/2015)

Legal Issues

Provide umbrella for decision maker to take decision in solving the issues and barriers(Presidential Regulation No.4/2016 on Acceleration of Electricity InfrastructureDevelopment)

DIRECTORATE GENERAL OF ELECTRICITYMINISTRY OF ENERGY AND MINERAL RESOURCESIEEJ：August 2016 © IEEJ2016

THANK YOU
Contact : report@tky.ieej.or.jp