10,000-MW project may suffer delay

The Jakarta Post ,  Jakarta   |  Fri, 10/05/2007 8:19 AM  |  Business

Ika Krismantari, The Jakarta Post, Jakarta

The government's fast-track of a 10,000 megawatts (MW) coal-fired power plant program will likely miss its 2009 target for commercial operation due partly to delays in tenders for construction, an official says.

Project coordinator M. Dalyono of the state electricity firm PT PLN, told The Jakarta Post on Thursday eight of the 10 power plants located in Java with a total capacity of 6,900 MW were expected to begin commercial operation in 2010, one-year behind target.

""(Due to) some processes ... a few contracts were only able to be signed in 2007, forcing the commercial operation of most of the plants to move from 2009 to 2010,"" Dalyono said.

A 2006 presidential decree, designated to accelerate the implementation of the 10,000-MW project, stipulates all power plants under this project must be completed and start operation by the end of 2009.

""It is impossible (to meet that target),"" Dalyono said.

""Even though the decree was issued in July 2006 ... we have to make sure that all the necessary processes (are) carried out properly,"" Dalyono said.

There are 10 projects located in Java. PLN, the company responsible, signed in March five contracts for the development of five power plants.

They in August followed this with another three projects and one letter of intent.

Dalyono said the project that would suffer the most delays was the 600-MW coal-fired plant in Tanjung Jati, Central Java.

He said this was because the company had decided to relocate the plant to Cilacap after recommendations via a feasibility study.

This forced PLN to re-tender the project and to set the project a new time schedule.

Construction would be started in 2008 and be completed by the end of 2010.

On the projects outside Java, where 25 power plants at a total capacity of 3,100 MW are to be built, Dalyono said 15 needed to be re-tendered, mostly due to lack of interested bidders.

The remaining 10 were still in the tendering process.

A government regulation on procurement says a tender must be include at least three bidders before it can start.

Yogo Pratomo, who heads the government's power-sector development program, told the Post that despite some projects outside Java still under tender, he was hopeful the projects would be completed on schedule.

Yogo said the capacity for each power plant was relatively small, ranging from 15 to 200 MW.

The 10,000 MW coal-fired power plant program is the government's way of rapidly boosting the electricity capacity in a country where more than 40 percent of its population, especially in rural and remote areas, do not have access to electricity.

It is also aimed at reducing PLN's dependency on much more expensive oil-based fuels to fire its power plants.

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