Indonesia provides investors with more facilities to develop geothermal energy

The Indonesian Ministry of Energy and Mineral Resources will make it easier for investors to develop geothermal energy in the archipelagic country through various innovational breakthroughs.

The facilities include the issuance of law on geothermal energy, which facilitates development of geothermal power plants in production forest areas, protected forest areas and conservation forest areas.

“In addition, we also call on geothermal energy contractors to make programs on public welfare and corporate social responsibility besides encouraging provincial and district administrations to use regional incomes from production bonuses,” Minister of Energy and Mineral Resources Arifin Tasrif said in a statement quoted by Antara news agency on Wednesday.

The government also encouraged the regional-based geothermal development through the Flores Geothermal Island (FGI) program to meet the need of geothermal electricity in East Nusa Tenggara province’s island of Flores, the minister said.

“The program will also be applied in other areas when the FGI program runs well,” he said.

To draw investment in the geothermal energy sector, Minister Tasrif said the government provides various incentives in the fiscal sector, including tax allowances, exemption from property tax and import duty.

In a bid to reduce risks contractors may face, the government initiates a scheme on the development of geothermal power plants in which exploration activities are conducted by the government, he said.

The government is also preparing a presidential regulation to readjust the prices of renewable energy in an effort to attract investors in new and renewable energy including the geothermal energy, the minister said.

The mixed energy of the new and renewable energy was targeted to reach 23 percent in 2025 when the energy consumption per capita touches 1.4 tons of oil equivalent (ToE) and the electricity consumption per capita reaches 2,500 kWh.

“In 2050, the mixed energy of the new and renewable energy was projected to increase up to 31 percent with the energy consumption per capita and the electricity consumption per capita reaching 3.2 ToE and 7,000 kWh respectively,” the minister said.

 

Source: China – ASEAN Business Council