T

he construction of the country'€™s largest coal-fired power plant in Batang, Central Java will continue as originally scheduled despite strong protests from locals and environmental groups, a senior government official said.

 Luky Eko Wuryanto, deputy for infrastructure and regional planning at the office of the coordinating economic minister, said in Jakarta on Friday that the government would do everything it could to ensure that the construction of the PLTU Batang power plant runs smoothly.

He said that the controversy and protests staged by locals and environmental groups were basically misleading.

The construction of PLTU Batang, which would have a capacity of 2,000 megawatts, the biggest in Southeast Asia, faced stiff opposition from local residents, who said that the power plant'€™s operations would damage the surrounding
environment.

Several locals have also accused the government of using forms of violence and intimidation when acquiring their land needed for the power plant'€™s establishment.

'€œThe condition there may not be fully conducive, but we are very firm in our position: this project will go on,'€ Luky told a limited press briefing on Friday.

He explained that, if the project failed to proceed, then it would deter prospective foreign investors looking to put their money in Indonesia'€™s infrastructure projects.

It would consequently hurt the image of the Indonesian government, which had actively promoted its Master Plan for Acceleration and Expansion of Indonesian Economic Development (MP3EI), as well as its Public-Private Partnership (PPP) plans, to lure foreigners to invest in the country'€™s much-needed infrastructure projects, the deputy minister said.

The US$4 billion power plant will be built by PT Bhimasena Power Indonesia '€” a consortium that comprises the Japan-based J-Power Electric Power Development Co. Ltd., Itochu Corporation, as well as local coal miner Adaro Energy. The power plant will operate as an independent power producer, which will sell its electricity to state owned electricity company PLN.

The PLTU will use an ultra super critical (USC) coal-processing system, which the company claimed as environmentally friendly and highly efficient, especially when compared to other conventional coal-fired power plants.

'€œAny accusation that this power plant will damage the environment is incorrect,'€ said Luky. '€œIf there'€™s an NGO talking [about the environmental damage of the PLTU], then we should really suspect their backdoor interests.'€

The consortium, through the assistance from the government, has so far acquired 186 hectares out of 226 hectares needed to construct the power plant. Luky said that the government planned to offer the locals Rp 100,000 per meter square for their land '€” far higher than the normal land price of around Rp 30,000 (US$3.08) '€” in its bid to expedite the land acquisition process, scheduled to be completed by October this year.

The deputy minister said that the construction of the PLTU was necessary to widen Indonesia'€™s electricity infrastructure outreach, eventually providing more incentives for industries to operate in the archipelago.

For Indonesia to sustain its economic growth of above 6 percent will need at least 4,000 megawatt of additional electricity every year, Luky noted.

Meanwhile, Greenpeace Indonesia'€™s climate and energy campaigner, Arif Fiyanto, said on Friday that the government'€™s plan to build the coal-fired power plants was contradictory to President Susilo Bambang Yudhoyono'€™s pledge to the international community to cut carbon emissions by 20 percent by 2020.

Arif, whose NGO spearheaded campaigns opposing the establishment of the PLTU by organizing rallies in Jakarta two weeks ago, denied the government'€™s claims that a power plant using the USC coal-processing system was environmentally friendly.

PLTU using USC technology only reduced the amount of coal burned for electricity, but did not reduce the emissions generated during the coal-burning process, he explained.

'€œFor example, if conventional power plants need 40 tons of coal to generate 100 watts of electricity, then with the USC coal-processing technology it would only need 20 tons to generate that same amount of electricity,'€ said Arif.

PLN initially expected the plant to be completed in 2016 on the assumption that land acquisition and permit issues would have been settled in October last year. However, problems have emerged that have kept construction on hold.

Landowners have held out, refusing to sell their land unless investors pay considerably inflated prices. Aside from the land issues, the Batang plant has been bedeviled by legal uncertainties.

The Batang administration is facing a lawsuit by villagers living near the planned site. The villagers oppose construction, claiming it will harm the surrounding environment.