Indonesia’s PLN still seeking $2b in loans for power plants

September 8, 2009

JAKARTA (Reuters) – Indonesia’s state power firm, PT Perusahaan Listrik Negara (PLN), needs to borrow $2 billion to fund the construction of new plants as part of the government’s crash power program, a company official said on Monday.

Southeast Asia’s biggest economy, which suffers frequent blackouts, has been struggling to resolve a power crisis in recent years.
“We are still in talks with several foreign and domestic banks to borrow a total of $2 billion. We expect to reach a deal as soon as possible,” Rudi Antara, PLN’s vice president director, told reporters.
PLN has already obtained around $6 billion of financing out of the $8 billion needed for the first phase of the government’s crash program to add 10,000 megawatts by building coal-fired power plants. Some of the funding has come from Chinese banks.
President Susilo Bambang Yudhoyono, who won a second, five-year term in July, has pushed the crash program to resolve the shortages.
The government also plans to build a second phase of 10,000 MW power plants, using coal and renewable energy such geothermal.
Antara said PLN will bring some of the coal-fired power plants into operation by the end of this year.
These include Rembang power plant in Central Java, with two units of 315 MW capacity, Labuan plant in Banten province, western Java, with two units of 300 MW capacity, and Indramayu in West Java province with three units of 350 MW capacity.
Originally, phase one was due to be completed next year, but because of difficulties in obtaining funds, completion has been postponed to 2011.
PLN, the monopoly power supplier in Indonesia, has 25,000 MW of generating capacity but daily output is far less because most of its plants are old and inefficient. Industry officials forecast Indonesia’s power demand will grow around 10 percent a year.