Coal PLTU Early Retirement Using APBN, ESDM Says Gini News – 9 hours ago

Jakarta, CNBC Indonesia – The Ministry of Energy and Mineral Resources (ESDM) has opened its voice regarding financing plans related to the early retirement of coal-fired Steam Power Plants (PLTU) which will use funds from the State Revenue and Expenditure Budget (APBN).

Secretary General of the Ministry of Energy and Mineral Resources, Dadan Kusdiana, said that in implementing the PLTU early retirement program, a mixed financing instrument would be used. The involvement of the APBN to fund this program is included.

“Some of our concepts are blended finance, so the funding is mixed. Maybe some from grants, some from grants, loans, some from the APBN, maybe later there will be funds from philanthropy. So that’s what the Ministry of Finance is currently preparing,” said Dadan. at the Ministry of Energy and Mineral Resources Building, Jakarta, quoted on Wednesday (25/10/2023).


According to Dadan, low or high funding for the PLTU early retirement program depends on the scheme that will be used. However, what is certain is that the government is trying to stop PLTU operations sooner than originally planned.

“Whether it is sold or accelerated, the scheme is different, the economics will also be a little different. There is another concept now, for example the phase down is stopped but not dismantled. There is also a concept like that,” he said.

As is known, the Ministry of Finance has just issued Minister of Finance Regulation (PMK) Number 103 of 2023 concerning Providing Fiscal Support through the Funding and Financing Framework in the Context of Accelerating the Energy Transition in the Electricity Sector.

Through this new regulation, financing related to the cessation of operations of a number of Steam Power Plants (PLTU) faster than the initial plan, aka early retirement, will use the APBN.

At least, there are two PLTUs that have been mentioned as being included in the early retirement program, namely PLTU Pelabuhan Ratu and PLTU Cirebon-1. To speed up the lethal injection of the two PLTUs, it is estimated that it will cost at least IDR 25 trillion. In detail, the Pelabuhan Ratu PLTU is IDR 12 trillion and the Cirebon-1 PLTU is IDR 13 trillion.

One source of funding that is predicted to be used to finance early retirement for PLTUs in Indonesia is through the Just Energy Transition Partnership (JETP) worth US$ 20 billion. This is an initiation of energy transition financing from developed countries, especially the United States and Japan so that Indonesia can abandon coal.

[Gambas:Video CNBC]

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