Renewable energy sector in Indonesia received a much needed boost when the US-based Overseas Private Investment Corporation agreed to provide debt to the largest wind energy project in the country.
OPIC President and Chief Executive Elizabeth Littlefield recently announced that $120 million shall be provided to UPC Sidrap Bayu Energy for the construction and development of 70 MW wind energy project in Sulawesi. The project is reportedly the ‘largest of its kind’ in the country. UPC Sidrap Bayu Energy is joint venture between US-based UPC Renewables and local company Binatek Energi Terbarukan.
The 70 MW project was first announced last year, in May, along with another project of 50 MW capacity. UPC Sidrap Bayu Energy is looking to develop 1,000 MW of wind energy capacity in Indonesia over the next 5 years. The company is also looking to expand operations in the solar power market.
Indonesia is looking to expand its renewable energy infrastructure. The country has a medium-term target for increasing the share of renewable energy in total energy use to 25% by 2025. Last year, the government set a target to increase the share of renewable energy in total energy mix to 19% by 2019.
Earlier this year, the government also announced plans to increase procurement of renewable energy by floating a new utility specifically for this purpose. The government considered this measure after reports that the country’s main power utility, Perusahaan Listrik Negara (PLN), is opposed to buying power from renewable energy projects due to the high costs involved in the exercise.