PLN, GE to build Indonesian biomass power plant

General Electric and Perusahaan Listrik Negara will cooperate in developing a model renewable energy power plant in Sumba, East Nusa Tenggara.

“This project will demonstrate the technical and economic viability of extending electricity to remote areas using biomass fuel sources. [The project] will also serve as a model for developing biomass power plants in other parts of Indonesia,” said PLN president director Nur Pamudji. 

The plant is expected to produce 1 megawatt of electricity using wood chips as fuel.

Under the agreement, GE will provide expertise in the construction of a power plant while PLN and local administrations in the island will provide 100 hectares of land for the wood plantation needed to supply the planned power plant.

The pilot project is a part of the efforts from PLN to trim down the country’s dependency on diesel power plants, which burn subsidized fuel and contribute to the state budget deficit, according to Pamudji.

Although total investment needed to construct a wood chip-fired plant would cost around 30 percent more than what was needed to build a diesel power plant, the return of the investment would be faster, said GE Asia Pacific’s gas engine market development director Made Wahyu Wiratma.

“The rate for the electricity from a diesel power plant is between 26 to 30 US cents per kWh, while the rate for the electricity from the wood chip-fired power plant is only 12 to 15 US cents per kWh,” he said.

Including the investment costs associated with establishing the 100-hectare wood plantation, the wood chip-fired power plant project will cost at least US$5 million, according to Made, who expected the biomass power plant to begin supplying power to the residents of Sumba Island in 2014.

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