Indonesian Government Issues Decree to Listrik Negara to Purchase Geothermal Power

The government of Indonesia through a fiat has ordered PT Perusahaan Listrik Negara, the state owned utility company, to purchase the power generated from the new geothermal plants in the country. This fiat is issued to sustain the investments in renewable energy sources.

Listrik Negara the utility based in Jakarta as per the decree will buy geothermal power from the new plants at a maximum rate of 9.7 U.S. cents per kilowatt hour. The decree has come into force from 16th February 2011. While purchasing power from the plants that were built before the present government order, Listrik will purchase the power on the basis of the price fixed by the utility companies and the government when they contracted the development rights. According to Surya Darma, Indonesian Geothermal Association’s head, the decree from the government will give a legal binding for speeding up the geothermal growth and in discharging the power purchase agreements.

Indonesia promotes the utilization of clean energy to speedup the supply of electric power in the remote areas of the country. The country is targeting to achieve an annual growth of 6.6% before Susilo Bambang, the President of the country completes his second term in July 2014.