The US$50 million loan is to Magma Nusantara Ltd, a subsidiary of Star Energy, a privately-held Indonesian energy developer, for the 200 MW Wayang Windu geothermal plant, 200 km southeast of Jakarta. The loan represents the first geothermal power investment by GE Energy Financial Services outside of the United States.
The geothermal facility is set in a volcanic region of tea and quinine plantations. The green power is sold to the high-voltage grid of state-owned power utility Perusahaan Listrik Negara.
The geothermal power plan began operations in 2000 and it was acquired by Star Energy in 2004 when capacity was 110 MW. Capacity doubled early this year with the addition of a second turbine and another two units will come on stream next year, boosting capacity to 500 MW at a cost of US$450m.
“The Wayang Windu project is ideal as GE Energy Financial Services’ first investment in the Indonesian energy sector in a decade,” explains James Berner of GE. “It illustrates two strategic themes for GE: the rise of Indonesia and the growth of renewable energy in our ecomagination programme.”
The geothermal power plant, named for Mt. Wayang and Mt. Windu volcanos in the highlands of West Java, provides baseload power. The facility taps into underground pockets of steam and hot water, with wells as deep as 3 km.
The geothermal fluid is brought to the surface and passed at high pressure through a steam turbine generator to generate electricity before being re-injected into the geologic formation. Positioned on the volcanic ‘Ring of Fire’ that circles the Pacific Ocean, Indonesia has one of the largest potential for geothermal resources in the world, estimated at 27,510 MW, with only 1052 MW (5%) developed. The government wants to install 9500 MW of geothermal capacity by 2025, accounting for 6% of the country’s energy supply.
GE has invested US$1,200m in Indonesia, where it began operations in 1940. GE Energy Financial Services has assets of US$22 bn, of which US$4 bn is in wind, solar, biomass, hydro and geothermal power.