JAKARTA, NNC - State electricity company PT PLN (Persero) signed a loan agreement with Kreditanstalt für Wiederaufbau (KfW) Development Bank of Germany to finance the construction of Kumbih III hydropower plant.
PLN Corporate Planning Director Syofvi Felienty Roekman and Senior Project Manager of KfW Jens Wirth signed the agreement on Friday, December 15, 2017 at PLN Head Office, Jakarta. Previously, the Director of KfW Office Jakarta Angela Tormin has signed her signature on this agreement.
"This loan is a direct loan without government guarantees. This is interesting because funding agencies from European countries such as KfW support projects from renewable energy like this, from feasibility studies to funding," Syofvi said in a release in Jakarta on Monday (12/18/2017).
Syofvi said the construction of 3x15 Megawatt (MW) Kumbih III hydropower plant requires about EUR100 million.
"The loan value we obtained from KfW amounted to EUR85 million with a 15-year tenor. The rest of the funding we prepare ourselves," said Syofvi.
Syofvi explained that Kumbih III hydropower plant to be built in Sumatra can help meet the needs of load growth in the northern part of Sumatra.
"It also lowers the cost of production on the use of fossil fuels both during base load and peak load times. And most importantly it increases the portion of renewable energy in the national energy mix target," added Syofvi.
Meanwhile, KfW Senior Project Manager Jens Wirth said that this is an important cooperation to support PLN in accelerating the addition of electricity from renewable energy in Indonesia.
"We hope the implementation of the project can be run quickly so that the benefits can be felt directly by the community," Jens said.
For information, the Kumbih III hydropower project will start construction in 2019. With a construction period of 4 years, it is expected to operate commercially in 2023.