Ministry of Finance and PT PII Support GeoDipa in the Dieng Unit 2 Geothermal Power Plant (PLTP) Development Project and the Patuha Unit 2 PLTP

19 AUGUST 2020

Jakarta, 19 August 2020 - PT Geo Dipa Energi (Persero) / GeoDipa, one of the Special Mission Vehicles (SMV) under the Ministry of Finance of the Republic of Indonesia, consistently carries out missions to develop power generation capacity by utilizing geothermal energy. In the midst of the Covid-19 pandemic conditions, GeoDipa has successfully completed financing efforts for the construction of the Dieng Geothermal Power Plant (PLTP) Unit 2 and PLTP Patuha Unit 2 with a capacity of 55 MW each.

PT PII and GeoDipa today, Wednesday (19/08) signed an agreement with the Asian Development Bank (ADB) for the Dieng Unit 2 Geothermal Power Plant (PLTP) Development Project and Patuha Unit 2 PLTP, as part of the efforts to provide electricity through the utilization of geothermal New Renewable Energy (EBT). The signing of the project includes the signing of the loan agreement between GeoDipa and ADB, the signing of the Guarantee Agreement between the Ministry of Finance and ADB, and the signing of the Guarantee Implementation Agreement between PT PII and GeoDipa.

The Dieng-2 Geothermal Power Plant (PLTP) Development Project and the Patuha-2 PLTP are projects financed by ADB and the Clean Technology Fund / CTF (channeling through ADB) to GeoDipa. The funds will be used to build unit 2 geothermal power plant projects in the Dieng and Patuha areas respectively.

The project with an investment requirement value of USD 469.2 million is included in the 2019-2028 Electricity Supply Business Plan (RUPTL) and aims to develop renewable energy-based power plants, namely through Geothermal energy. Furthermore, the existence of this Geothermal energy generation project can support the achievement of the renewable energy mix target of 23% in 2025 according to the National Energy General Plan (RUEN), reduce carbon emissions, and contribute to Government programs related to providing electricity to the community.

Previously on March 6, 2020, based on the results of a joint evaluation between the Ministry of Finance and PT PII, the Ministry of Finance issued a Minister of Finance Decree (KMK) regarding an assignment to PT PII to provide guarantees against the risk of default from GeoDipa, which receives direct loans from ADB to finance development projects. PLTP Dieng-2 and PLTP Patuha-2, as well as Principle Approval Letter to GeoDipa.

The government, in this case the Ministry of Finance, has provided support for the development of renewable energy sources of electricity, which is realized, among others, by the existence of Ministry / Institution budget posts for the development of EBT-based power plant infrastructure, as well as fiscal tools facilities, namely government guarantees through PT PII. This is in line with developing Indonesia's vision and mission in accelerating the implementation of a national geothermal project development process based on domestic energy use and playing a role in supporting government efforts to attract private sector investment in this sector.

Director General of Financing and Risk Management (Dirjen PPR) of the Ministry of Finance, Luky Alfirman, in his remarks said that the Government, through the Ministry of Finance, remains consistent in continuing to accelerate infrastructure development, including this power plant construction project, in order to meet one of the basic needs of society, namely electricity.

"By providing support through guarantees for this project, the Ministry of Finance together with the Ministry of Finance's SMV, namely PT PII and GeoDipa, are taking part in increasing renewable energy power plants that are environmentally friendly, reducing carbon emissions and indirectly increasing the community's economy by creating jobs. new ones that can improve the welfare of the community during the Covid-19 pandemic, ”Luky continued.

Meanwhile, the Managing Director of PT PII M. Wahid Sutopo said that the guarantee mandated by the Ministry of Finance to PT PII as the implementer of the guarantee for the Dieng Unit 2 Geothermal Power Plant (PLTP) Development project and the Patuha Unit 2 PLTP is a concrete form of effort. PT PII in supporting the Government's program to provide geothermal power that is safe and environmentally friendly and provides benefits to improve the Indonesian economy which has a direct impact on the community. Through PT PII's support for this project, it is hoped that it will contribute to efforts to restore the national economy by ensuring the availability of environmentally friendly electricity supplies to the community.

"This project is the second project guaranteed by PT PII in the energy conservation sector, where previously PT PII has provided guarantees for the Hydropower Program project. This project financing that will facilitate the electricity needs of the community cannot be separated from the support from the Ministry of Finance, including the guarantee implemented by PT PII, ”continued Sutopo.

President Director of GeoDipa, Riki Firmandha Ibrahim, explained that the PLTP Dieng Unit 2 and Patuha Unit 2 projects are a very strategic sustainable investment. This is because clean energy production will increase and reduce dependence on fossil fuels for the sake of sustainability and national energy security.

"Geothermal utilization promises better environmental conditions. This is because the operation of geothermal power plants produces almost no carbon emissions that damage the earth's layers in a sustainable manner. Thus, the development and utilization of geothermal as an energy source supports the government's commitment to reducing carbon emissions in accordance with the Paris Agreement in the United Nations Framework Convention on Climate Change, "said Riki.