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Jakarta Post

GE picks Indonesia to launch $1.4 billion new business

  • Mariel Grazella

    The Jakarta Post

Jakarta   /   Wed, February 26, 2014   /  12:12 pm

American technology company General Electric (GE) Co. has stated that it has chosen Indonesia as the country in which to launch its US$1.4 billion distributed power business, which concentrates on smaller-scale energy generation.

GE officially introduced its distributed power business in Jakarta on Tuesday to tap into the archipelago'€™s future energy blueprint.

GE vice chairman John G. Rice pointed out that Indonesia was '€œthe perfect place'€ to develop distributed power technology given that roughly a quarter of the 240 million people living across the archipelago of at least 9,000 islands had no access to electricity.

This, he added, created a sector in which GE could deploy its distributive power technology, which could generate between 100 kilowatts (kW) to 100 megawatts (MW) of power onsite.

'€œThe population is also very distributed, which makes Indonesia a big market,'€ he said, adding that GE had been in Indonesia for at least 70 years.

He further said the Indonesian government'€™s aim to shift the weight off fossil fuels to renewable energy was a supporting element for conducting pilot projects in the country.

'€œTherefore, Indonesia is a very strategic host country for pilot projects to demonstrate the efficiency of our technology,'€ he told The Jakarta Post.

Indonesia'€™s current energy mix comprises approximately 49 percent fossil fuels, which the government aims to reduce to 25 percent by 2025 based on the increased contribution from renewable resources.

Rice added that '€œa part'€ of the $1.4 billion that the Schenectady-based company was investing over a four-year period to get the new business up and running would go to pilot projects in Indonesia.

During the launch of its distributive power business, GE announced the signing of a memorandum of understanding (MoU) involving state-owned electricity company PT Perusahaan Listrik Negara (PLN) and PT Clean Power Indonesia (CPI) on the development and deployment of biomass gasification power systems.

The development is part of a previously announced collaboration for work on a 1 MW power generator in Sumba, East Nusa Tenggara (NTT), and a 150 kW power generator in Bangli, Bali. GE also announced contracts to supply four gas engines for a gas compression facility belonging to state-owned oil and gas company PT Pertamina in Lembak, nearby Palembang, South Sumatra.

Rice added that the pilot projects would involve using biomass to generate affordable power.

'€œOur primary interest is to develop capabilities to combust the broadest range of fuels, including biomass, sugar, coconut frond, rice husks and Napier grass,'€ he said.

'€œBasically [...] any agricultural by-products that people currently cart away.'€

GE'€™s ASEAN regional general manager for distributed power, John Alcordo, pointed out that the Bali facility, which would start operation in the next six to eight months, would rely on bamboo waste.

'€œThe bamboo can come from the waste from handicrafts,'€ he said, adding that a volume of around 2 tons of bamboo was needed per MW.

Deputy Energy and Mineral Resources Minister Susilo Siswoutomo added that GE had made a good decision to launch the distributed power business in Indonesia.

'€œThe growth is here because we have power generation needs from 0.5 MW to thousands of MW,'€
he said.

'€œHence, we open our doors to anyone who can help us generate an additional 6,000 MW per year at the very least.'€

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