660MW Thermal Power Unit Officially Launched in Cirebon

The first unit of a coal-fired power plant with a production capacity of 660 MW has been officially launched in Cirebon, West Java, which is hoped to boost the electricity supply in Bali and Java. Energy and Mineral Resources Minister Jero Wacik launched the plant, the Cirebon Electric Power Plant (CEP), which is located on a 100-hectares of land on the coastalof Cirebon.??

Earlier this year, state utility firm PT Perusahaan Listrik Negara (PLN) announced the electricity supply for Java and Bali was around 22,900 MW, while demand in the region was 35,000 MW or larger by 35 percent.??The new 660 MW-plant, among Indonesia’s first to use supercritical-boiler technology that consumes coal more efficiently and produces less carbon dioxide, is expected to supply 5,500 gigawatt-hour of electricity to Bali and Java per year or around 4 percent of the electricity supply in the region.??

Electricity from the Cirebon plant will be distributed through the Java-Bali interconnection. ??“We hope that the Cirebon plant can also increase investor confidence and thus provide a boost to the economy since the electricity supply will be increased thanks to the plant,” Jero said in his opening speech of the plant’s inauguration ceremony.??

CEP, which is one of independent power producers (IPPs) in Indonesia, is a joint venture between four companies, with Japan-based Marubeni Corporation owning the biggest stake of 32.5 percent, followed by Korea Midland Power Co, which owns a 27.5 percent stake in the firm. The other shareholders include South Korean company Samtan Co Ltd and Indonesia’s publicly listed PT Indika Energy, each own 20 percent.??

In August 2007, CEP signed a power purchase agreement (PPA) with PLN, which included a contract period of 30 years.? The Cirebon plant project has a total investment of US$850 million for its construction, which began in 2008.

The Cirebon power plant needs a supply of around 2.85 million tons of coal annually, which will be supplied by Kideco, a subsidiary of Indika Energy, and publicly listed coal producer PT Adaro Indonesia.? PLN president director Nur Pamudji said the state utility firm would buy the electricity produced by the new plant with a rate of 4.43 cents per kilowatt-hour (kWh) with an assumption the coal prices was at $30 per ton. However, he added, that PLN would buy the Cirebon plant-produced electricity at 5.2 cents per kWh given the present coal prices.??

Separately, Indika Energy vice president director Wishnu Wardhana said the firm was mulling a plan to build a second unit for the Cirebon plant with a capacity of 1,000 MW, with a planned investment of around $1.2 billion to $1.3 billion.