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PLN opens bid to de-dieselize 212 MW of power plants
The program is part of PLN's plan to cut costs and transition to cleaner energy.
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PLN has opened a tender to convert 212 megawatts (MW) of diesel power plants spread across 183 locations into lower-emission power plants as part of the state-owned power company's cost-cutting and energy transition plans.
The company announced the tender of this first phase de-dieselization program on March 1 and held a pre-bid meeting on March 23. The power plants are located in the Java-Madura and Kalimantan islands.
PLN president director Darmawan Prasodjo said tender winners would be announced at the end of 2022, and the signing of power purchase agreements would take place in 2023.
“The trend of decreasing new and renewable energy prices is ongoing. De-dieselization project auctions are in progress, there are currently 160 eligible companies participating in the auction,” Darmawan said during the strategic cooperation toward carbon neutral 2060 signing ceremony on Thursday.
Previously, the electricity company planned to conduct project biddings in December 2020 and aimed to swap out 200 old diesel-powered power plants with solar power stations by 2022.
“This de-dieselization program will be a big leap in achieving the government’s target toward the net zero emission target,” said Energy and Mineral Resources Minister Arifin Tasrif of the program on the sidelines of a Group of 20 Energy Transition Working Group (ETWG) meeting on Wednesday.
PLN mega project and new and renewable energy director Wiluyo Kusdwiharto said diesel power plants in the first phase would be converted to hybrid solar-battery energy storage system (BESS) power plants and hybrid solar-BESS-diesel power plants.
“Phase 1 will be divided into eight clusters, each with a capacity of 14 to 55 MW. Clustering increases the size and economics of the projects, making it more attractive to investors,” he said.
Read also: PLN aims to swap out 200 old diesel power plants with solar by 2022
State-Owned Enterprises (SOEs) deputy minister Pahala Mansury said: “[We hope] business model improvements, new and renewable energy projects implementation and carbon emission reduction will attract more parties to cooperate with PLN,”
PLN ultimately aims to replace 1,873 MW worth of diesel plants with hybrid renewable energy plants, gas and isolated interconnection systems to the grid, with a total capacity of 499 MW, 304 MW and 1070 MW, respectively.
Read also: Painstakingly slow progress on renewable energy infrastructure
PLN started developing a de-dieselization program in mid 2020, mapping 5,200 existing diesel power plants across Indonesia.
PLN’s de-dieselization program aims to boost clean energy usage and lower production costs, whereby diesel-generated electricity is among the most expensive electricity per kilowatt hour, mainly due to fuel-related costs.
