ADB Finance Indonesian Power Plant

The Asian Development Bank (ADB) has agreed to finance Jawa-1 power plant in Indonesia. Credit: Asian Development Bank.

The Asian Development Bank (ADB) has agreed to finance Indonesia’s largest combined-cycle gas turbine (CCGT) power plant, Jawa-1.

Located in Cilamaya, Karawang, West Java, the project uses liquefied natural gas (LNG) and comprises a 1,760MW CCGT power plant and ancillary infrastructure.

The CCGT power plant will supply energy to Perusahaan Listrik Negara (PLN), Indonesia’s national power utility, and is expected to help Indonesia avoid 1.77 million tonnes in carbon emissions.

Totalling more than $305m, ADB’s financing package includes a direct loan of $185m and a parallel loan of $120m from Leading Asia’s Private Infrastructure Fund (LEAP).“This project will support the country’s efforts to strengthen the liquefied natural gas (LNG) supply chain and increase energy security while helping to reduce power generation costs.”

Administered by ADB, LEAP is one of the bank’s co-financing vehicles committed to private sector infrastructure in Asia and the Pacific.

The project is expected to generate electricity that will be sufficient to power 11 million Indonesian households from 2021. It will also support the country’s target of 100% electrification by 2024. It is expected to create nearly 4,800 jobs during the construction period and 125 jobs when operational.

ADB Private Sector Operations Department director-general Michael Barrow said: “ADB is a partner of choice in Indonesia’s strategy to finance low-carbon power generation through private sector participation.

“This project will support the country’s efforts to strengthen the liquefied natural gas (LNG) supply chain and increase energy security while helping to reduce power generation costs.”

Since 2005, ADB has been supporting Indonesia’s natural gas value chain. In that year, a $350m loan was granted for the greenfield development of Tangguh natural gas liquefaction facility. A $400m loan for the plant’s expansion was granted in 2016.