Jakarta, CNBC Indonesia – Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif said the use of solar energy in Indonesia is still very low. He said that currently the installed capacity of the Solar Power Plant (PLTS) is only 154 mega watts (MW). In fact, the potential for solar energy in Indonesia reaches 207.8 giga watts (GW).
Therefore, according to Arifin, Indonesia needs to create a significant and attractive market for investors, including in the upstream solar panel sector.
“We must be able to create market which significantly attracts investment in the upstream sector and we have quite a lot of raw materials from upstream, this will have another effect, including small-scale industries that can grow large and SMEs can participate, “he said in an online discussion of Solar Power Industry Development, Friday night (21/05/2021).
He admitted that currently there is still an issue of Domestic Component Level (TKDN) in the PLTS or solar panel industry. For this reason, his party will also try to improve regulations related to this matter.
“We have a problem at the Domestic Component Level (TKDN), the government supports TKDN, this is a sector that must be improved jointly by the PLTS industry players,” he explained.
He said that opening up this upstream opportunity requires binding regulations, so that investors can enter and Indonesia will not be left behind from other countries whose solar power industry has developed.
“Why is ACWA Power a company in Saudi Arabia, Masdar, Mubadala (a United Arab Emirates company), why can it compete in the international market to market PLTS plants? Because they control the upstream sector,” he said.
According to him, Indonesia has a large market potential. If this market potential is utilized optimally, it will be able to jointly create opportunities.
“We have a big market, 30, 40, 50, how many tens or even 100 GW can be used, we both create opportunities,” he explained.
Arifin estimates that the use of PLTS in the future will continue to increase because this cannot be separated from the continued decline in investment costs significantly. In just one decade, he added, the reduction in the investment cost of PLTS has reached 80%.
“In fact, the lowest bid for PLTS development in Saudi Arabia by ACWA Power is 1.04 cents per kWh. The decline in PLTS investment is also felt in Indonesia, where the selling price of the Cirata floating PLTS with a capacity of 145 MW is 5.8 cents per kWh,” he said. Arifin.
“In fact, based on market sounding by PLN, the offer for PLTS floating electricity prices in several locations is between 3.68-3.88 cents per kWh, “he added.