Indonesia:

Sarulla – Re-Energising the Geothermal Sector (Project Finance International)

The US$1.6bn Sarulla geothermal project achieved signing of the financing documentation on March 28 2014, marking an important milestone for the geothermal power market in Indonesia. Overall power demand in Indonesia is projected to grow by more than 8% per annum until 2029. As – such, the Government of Indonesia recognises the economic imperative of sustainable growth and aims to increase the share of renewable energy in Indonesia’s primary energy supply from 5% in 2010 to 25% by 2025.

With more than 29,000 MW of geothermal resources (equivalent to 40% of the global geothermal resource base) located in Indonesia and with a number of new geothermal power projects at various stages of development, it is expected that geothermal power will account for the vast majority of the new sustainable power generation to come on line, as well as a significant portion of Indonesia’s overall new power generation capacity. As the first greenfield geothermal power project to achieve successful signing of limited-recourse project finance documentation since Unit 1 of the Wayang Windu Geothermal Power Project in 1997, the Sarulla Geothermal Project should establish a new blue-print for the next generation of geothermal power projects in Indonesia.

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