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Jakarta Post

PLN to spend $15b to build gas-fired power plants

Posted: Thu, February 24 2011 | 12:20 pm

State electricity firm PT PLN said Wednesday that it would need to set aside US$15 billion ( Rp 132.71 trillion ) to support its plan to build several natural gas-fired power plants by 2019.

PLN director for planning and technology Nasri Sebayang said that the construction of the power plants, which would be able to generate up to 11,000 megawatts, would reduce its dependence on oil-based energy sources.

“PLN currently operates 5,233 power plants across the country with a combined capacity of 24,960 megawatts, but only 22 percent of them, or 1,151 units with a combined capacity of 9,800 megawatts, use natural gas as their energy sources,” he said after speaking at
the 2011 Pacific Energy Summit in Jakarta. However, PLN was unsure whether the planned power plants would receive enough gas supply as nearly a half of the existing production was committed to exports, Nasri said.

PLN said earlier that this year it received a gas supply of only 802,74 million standard cubic feet per day ( mmscfd ), far below its actual needs of around 1,800 mmscfd.

Beside boosting the utilization of natural gas, PLN would add the number of its coal-fired power plants from currently only 50 to 60 percent of all power plants in the next 10 years, the company’s primary energy director, Nur Pamudji, said at the same gathering.

“We predict that we’ll need around 50 million tons of coal for our power plants in ten years to come,” he explained on Tuesday at the summit.

Coal was chosen due to its very cheap prices, he said. Using coal, the company only needs to spend 4 cents to produce a kilowatt-hour of electricity.

Nasri said that the company had to spend around 25 US cents to produce a kilowatt-hour of electricity if it used oil-based fuels, 5 cents if it used natural gas and 9 cents if it used geothermal.

However, the company has complained about the difficulties in making deals with coal suppliers due to price disagreement. Most suppliers asked the company to pay international prices, which are 20 percent above the country’s coal reference price.

—JP/ Rangga D. Fadillah

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