Indonesia to begin building huge coal power plant in 2015

[JAKARTA] Indonesia will begin building a huge coal-fired power plant next year, government officials said on Thursday, as Southeast Asia's biggest economy looks to keep pace with soaring electricity demand and avert a power crisis.

The 5,000-MW power plant will be built in central Java and generate an initial 2,000 MW when it begins operations in 2018, Indroyono Soesilo, head of the new coordinating ministry for maritime affairs, told reporters.

Completion of the entire project is likely to take seven years, he added.

Electricity demand growth in Indonesia has outstripped a rise in generating capacity, leading to frequent blackouts in cities and leaving rural areas without regular power supply. "We need 35,000 MW of electricity capacity in the next five years," Mr Soesilo said. "Without new capacity we will have an electricity crisis." Although Indonesia's army owns some of the land needed for the Cilacap plant, Soesilo said reviews of current laws and government regulations would bypass potential red-tape.

The new power plant will also use the latest technology to cut air pollution, said Energy Minister Sudirman Said.

Said aims to tackle corruption in the energy ministry as a key goal, he told reporters last week, warning that Indonesia must act with a "sense of crisis" to meet future energy needs.

Indonesia's electricity demand will rise to 207 TeraWatt-hours (TWh) this year, up almost 10 per cent from 189 TWh last year, the government and the state utility have said.

Indonesia is expected to nearly double its consumption of thermal coal over the next eight years to help meet annual growth in electricity demand of around 8.4 per cent, the state power company says.

Government data shows roughly a fifth of the nation's population of almost 250 million had no access to electricity, as of last year.

REUTERS