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innish energy company Fortum, an investor in the city’s first intermediate treatment facility (ITF) for garbage, has expressed its desire for legal certainty regarding the development of the facility amid myriad complications that have left the project in limbo for more than a year.

City-owned developer PT Jakarta Propertindo (Jakpro) signed in December 2016 a deal with Fortum to develop and operate the facility in Sunter, North Jakarta, through the establishment of a joint venture.

The ITF will have the capabilities to process 2,200 metric tons of the 7,000 tons of solid waste produced in the city per day and produce around 40 megawatts of electricity using waste to energy (W2E) technology.

Since the signing of the agreement, uncertainty over the project has emerged with the Supreme Court revoking Presidential Decree No. 18/2016 on the acceleration of waste to energy development in seven cities due to environmental concerns.

Another challenge has come from the issuance of Government Regulation No. 54/2017 on city-owned companies (BUMD), which requires the city-owned company to own at least 70 percent of shares in the subsidiary company.

The regulation has forced the companies to alter their business scheme as previously both had agreed that Jakpro would hold a 51 percent share while Fortum would hold the remaining 49 percent.

Izabela van den Bossche, Fortum VP of corporate communications, said the company still had some questions regarding the legal framework for the waste management system in Indonesia.

The company hoped the questions would be answered by new legislation set to be adopted in the next few months, she said.

The government is set to issue a new regulation to replace the decree, which has been revoked by the Supreme Court.

Meanwhile, Jakarta Governor Anies Baswedan is set renew Governor Regulation No. 50/2016 by issuing a new regulation on the development of the ITF.

“We are waiting for both the presidential and the governor’s decrees. Those two documents will determine a number of aspects which are crucial for the project, such as the level of the feed-in tariffs and the confirmation that the ITF project is on the list of accelerated projects,” Van Den Bossche told the Jakarta Post recently.

As the delegation of the job from the Jakarta administration to Jakpro ended last March in accordance with Governor Regulation No. 50/2016, Fortum has said it hoped the new regulation would lay out the mandate for Jakpro to develop and operate the plant.

Van Den Bossche added that Fortum was committed to working in line with these regulations.

She added that the company understood that the process to develop a W2E facility was never quick and easy, especially considering that the country was seeking to build its first such facility.

However, to maintain the investor’s interest in the project, the government and the Jakarta administration were expected to provide a stable regulation framework, she said.

“A stable regulatory framework and business environment are keys for any investors, especially when considering long term and significant investments such as the ITF project we are working on,” Van Den Bossche said.

Jakarta Environment Agency deputy head Ali Maulana Hakim said on Tuesday that the new governor regulation on the ITF could be issued in the near future.

The draft of the regulation laid out the renewal of the job delegation to Jakpro, Ali said.

He said Jakpro and the private party would be given the right to operate the facility for 25 years.

“They should construct the ITF within a period of three years,” Ali added.

Meanwhile, president director of Jakpro Satya Heragandhi said the company had been informed that the president would soon issue a new decree on the ITF.

The new presidential decree and the Jakarta governor’s regulation would pave the way for the establishment of the ITF, despite the business scheme requirement included in Government Regulation No. 54/2017, he said.

“We will harmonize our business model with the regulation. We’re still discussing the content of the regulation with the government, but we’re sure the regulation won’t hamper the development of the ITF,” he said.

The operation of the ITF was urgent, so Jakpro wished to begin the project in May, Satya said.