SUPPORTING RENEWABLE ENERGY & ENERGY

CONSERVATION IN INDONESIA
Anh Pham
Senior Energy Specialist

Renewable Energy Convention June 4-5, 2014

Introduction
WB in Renewable Energy and Energy Efficiency

Trend in Renewable Energy Lending

Technical Assistance & Policy Advice
Investment Lending
Strategic priorities for EAP energy practice

Indonesia

Key Issues and Challenges

Country Engagement Program
Technical Assistance & Policy Advice
Investment Lending

WB: Renewable Energy Lending

Technical Assistance and Policy Advice

China 1997 - 2009: scaling up wind energy: market support

mechanisms (including feed in tariff and bidding systems); support
for renewable energy law (passed 2006); technology improvement
support for manufacturers; education and training;
Vietnam 2010: small hydro: development of an avoided cost tariff
and associated regulations to allow small hydro up to 30MW to sell
to grid; integration of renewables into market reforms.
Multiple countries 1999 onwards (China, Croatia, Vietnam);
development of methodologies to determine economic levels of
grid connected renewables
Global Initiatives

Global Geothermal Development Plan (2014, including Indonesia)

Renewable Energy Resource Mapping (including Indonesia since 2013)
City Energy Efficiency Transformation Initiative

Investment Lending

Large hydro: Nam Theun 2, Lao PDR (1,070MW, $1,450 million of which
WB $42.5 million); Trung Son, Vietnam (260MW, $412 million of which
WB $330 million); Tarbela IV (1,450MW, $914 million of which WB $840
million)
Wind: Pingtan, China (100MW, $106 million of which WB $66 million);
Turkey Renewable Energy Integration ($475 million of which WB $300
million)
Biomass: Jiangsu, China (25MW, $35 million of which WB $20 million);
Solar thermal: Kureimat, Egypt (30MW solar, $328 million of which WB
$50 million); Ain Beni Mathar, Morocco (30MW Solar, $527 million of
which WB $43 million)
PV off grid: China Western Provinces (400,000 households, WB $27
million); Bangladesh (2 million households, WB $155 million)
Energy Efficiency Bosnia ($32 million, of which WB $32 million);
India Partial Risk Sharing Facility, Super Energy Efficiency Equipment
(about $500 million of which WB $103 million)

Strategic Priorities for EAP Energy

Focal areas

Turning strategy into action

Improving energy
efficiency

Institutional capacity building and policy advice

Introducing new financing mechanisms and market-based
approaches including trade in energy saving certificates
Energy efficient cities and green infrastructure

Scaling up
renewable energy

Policy and regulatory framework (feed-in-tariff)

Resource assessment and pre-investment activities
Financing RE (hydropower, wind, geothermal, solar PV)
Supporting T&D projects, regional integration and trade

Increasing access
to modern energy

Capacity building and institutional development

Grid and off-grid rural electrification programs
Access to clean and efficient cooking fuels and facilities
Knowledge sharing, regional initiatives and partnerships

New energy
solutions
Market Reforms

Regulatory framework for advanced energy solutions

IGCC/CCS, energy storage, electric vehicles, smart grids
Low-carbon energy solutions, conventional and unconventional gas
Stable and transparent regulatory regime for PPP
Cost-reflective tariff system and well targeted subsidies for poor
and vulnerable consumers
Gradual introduction of environmental externalities in the energy
pricing

Indonesia
Context: Key Issues and Challenges

End Extreme Poverty: Increase access to modern energy to combat poverty

Improve Shared Prosperity: Support reliable, adequate and a sustainable electricity service to fuel inclusive
economic growth

Challenges

Over 70 million people lack access to reliable electricity in Indonesia. This is half of those without access in East Asia.

Every second household in Indonesia still depends on solid fuels i.e. wood and bio-mass for cooking.

The demand for power doubled in the last 7 years, requiring US$ 10 billion annually in new investments.

Energy subsidies account for a quarter of Central Government expenditure.

Coal is projected to account for 60% of the fuel used for power generation in 2025. This has environment costs.

Implementation capacity at all levels. Lack of coordination across GoI and between central & local

Opportunities

Transition from existing to new Government: Interests in long term development strategy

Government target of expanding rural electrification to 90% by 2020

Indonesia has significant geothermal, hydropower, gas and biomass energy potential.

Government is committed to scale-up renewable energy to 17% of the energy mix by 2025.

Government committed to improve sector efficiency and better target the energy subsidy.

Indonesia

Energy Sector- Engagement Pillars

Low Carbon Sustainable Energy
Infrastructure

Increasing Access to
Modern Energy

Improving
Energy Efficiency

Pipelines SIL
Mattenggeng Pumped Storage ($500mil,
FY16)
Poko Hydro ($360 mil, FY16)
Geothermal II ($200 mil, tbc)
On-going SIL
-Geothermal ($300 mil, FY12)
- UCPS ($640 mil, FY11)
AAA & Non lending
Energy Subsidy Reform
NZ Grant Geothermal Capacity Building
ESMAP TF -PPP options for hydro
generation (FY12-13)
ASTAE for Poko Preparation
ASTAE for Geothermal (support
investment)
ESMAP Benefit Sharing for Hydro (FY14)
Gas Sector Regulations

Pipelines SIL
1000 Islands (REEP) (FY14)
On-going SIL
Transmission I ($225 mil, FY10)
Transmission II ($325 mil,
FY13)
AAA & Non lending
Geospatial Mapping and Least
Cost Electrification Delivery
Renewable Energy Resource
Mapping
Scaling up Access to Clean &
Efficient Cook Stove

Pipelines
GEF EE for Large Industrial
Enterprises (FY15)
AAA & Non lending
TF Smart Grid
CCS (FY14)
Green Growth for Energy
Sector

Indonesia

Technical Assistance and Policy Advice

Support MEMR to revise Pricing Policy for Geothermal

Development
Capacity Building for Geothermal Investment (NZ Grant to PGE)
Public Private Sector Participation for Hydro Generation
Benefit Sharing for Hydro Power Investments
Renewable Energy Resource Mapping and Geospatial Planning
Capacity Building for Smart Grid Planning and Investment
Support to Introduction of Performance Based Regulation to PLN
Pre-Investment

Support Geothermal Investment II

Capacity Building for Integrated Basin Planning, Sediment Management and
Preparation of Poko Hydropower Project

Indonesia

Investment Lending- IBRD

Under implementation
Geothermal Clean Energy Investment Project. IBRD: US$ 175 million; CTF
$125 million
Upper Cisokan Pumped Storage Hydro Electricity Project IBRD: US$ 640
million
Under Preparation FY 15-17
Renewable Energy for Rural Electrification; IBRD $150 million
Matenggeng Pumped Storage Hydro Electricity Project; IBRD: US$ 500
million
Poko Hydro Power Project; IBRD: US$ 360 million
GEF Grant for Large Enterprises Energy Efficiency Project; GEF: $5.48 mil

Terima Kasih!

China

China
Past & Current Portfolio
Projects at a glance:
IBRD, IDA, GEF & CDM

$10.4 b* since 1983

$1.6 b since 2004, 92% green
$1.2 b active portfolio, 20 projects
(originated since 2008)

Largest mobilizer of GEF mitigation

$289.81 m since beginning ,o/w
56% in last decade

37% of active portfolio low

carbon cities

* Excludes additional $978 m for industrial development and

other mining mapped to energy and mining 1983-1997