USAID develops a reference in power purchase agreement evaluation for financial service institutions

USAID Indonesia Clean Energy Development II (ICED II) has been assisting financial service institutions (FSI), banks and non-banks, through Financial Services Authority (Otoritas Jasa Keuangan – OJK), or direct assistance to individual institution. The assistance covered trainings, project evaluation and production of modules related to renewable energy technology and financing, with the goal is to improve FSI’s capacity to realize renewable energy financing in Indonesia. Power purchase agreement between independent power producer and State Electricity Company (PLN) plays an important role for FSI, especially during projects’ due diligence phase in determining the projects’ bankability. To provide a reference for FSI, USAID ICED II is developing a guideline to evaluating power purchase agreement for financial service institution.

As part of the book development process, on May 23, 2019, USAID ICED II held a consultation meeting with the financial service institutions, OJK and the National Development Planning Agency (Bappenas) to gather lenders’ insights and feedbacks on essential key issues in evaluating power purchase agreement for renewable energy projects. USAID ICED II is set to finalize the guidebook in three months for further adoption by OJK as the regulator.

 

Indonesian youth discuss green jobs opportunity in renewable energy.

A couple hundred of youth and young professionals filled the auditorium of @ America cultural center in Jakarta, to understand and discuss green jobs and its opportunities in Indonesia, especially in renewable energy sector. Held on June 25, 2019, with the support from USAID ICED II and CoAction Indonesia, an Indonesian nongovernmental organization, the event featured four young professionals from private and public sector shared their professional experience in renewable energy. Two of them are founders of renewable energy start-up using solar photovoltaic (PV) technology i.e. Erenesia (https://erenesia.com/)and Weston Energy (https://westonenergy.co.id) , one is working in renewable energy service company i.e. PT Resco Sumba Terang (https://resco.co/), and another one is working as an engineer in Indonesia’s state utility company (PLN). They spoke on the skills required to thrive in the business. The enthusiastic audience came up with a series of questions about job opportunities, price of solar PV installation, and how to earn profit from renewable energy start-up businesses. Green jobs will not only contribute to Indonesia’s economic growth but also help put Indonesia on the path to self-reliance.

 

Indonesia’s utility receives training on power system analysis.

Indonesia’s State Electricity Company (PLN) had training on power system analysis from Professor Vijay VIttal from Arizona State University, supported by USAID through Indonesia Clean Energy Development II (ICED II) program. Held on June 10-14, 2019, the training was attended by 67 employees of PLN and Director General of Electricity of the Ministry of Energy and Mineral Resources. They learned about how to ensure the stability of PLN’s power system to increase penetration of electricity from variable renewable energy such as solar photovoltaic and wind. The training aims to build PLN’s capacity in analyzing and controlling its power system to cope with disturbances in the power grids. The participants also learned about case studies from other countries, as well as root cause analysis and mitigation strategies. USAID expected the training will boost the expansion of variable renewable energy deployment in Indonesia, and address PLN’s main concerns in integrating variable renewable energy into their power grid.

Integrating solar PV power to Sumba Timur power grid

Integrating variable renewable energy (VRE) such as solar photovoltaic (PV) into State Electricity Company’s (PLN) power grid has been PLN’s main challenge for quite some time. One innovative solution for the challenge is the automatic dispatch system (ADS). USAID Indonesia Clean Energy Development II (ICED II) assists PLN to adopt the innovation, which in the long run will help PLN plan distribution grid and generation, as well as distribution grid control to increase the reliability and quality of PLN’s distribution grid operation. On May 15, 2019, USAID ICED II and PLN started a commissioning test to run the installed ADS. The ADS was installed in the 20 kilovolt (kV) Sumba Timur distribution grid because the grid is connected to the 1 Megawatt peak (MWp) solar PV power plant and controls the diesel power plant at Kabanjawa Station. During the test, the ADS performed well and was able to control the grid frequency at stable rate by managing the operation of Kabanjawa diesel power plant to meet the variability of power load/demand and the variability of 1 Mwp solar PV power plant output. USAID ICED II and PLN will continue to observe the situation for two weeks, especially during critical hours (peak hours or high ramp rate hours) to see how the controllers and the generation power plants system balance power supply and power load, if a nearby 1 MWp solar PV power plant supplies electricity intermittently due to weather condition. The success of ADS installation, testing and operation boosted PLN’s understanding and confidence to replicate the innovation to increase VRE integration and penetration in other distribution grids.