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TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

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Page 1: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation
Page 2: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation
Page 3: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

TABLE OF CONTENTS

ABBREVIATIONS

PREAMBLE

NATIONAL ENERGY REGULATORY FRAMEWORK

FINANCIAL INCENTIVES REGULATORY FRAMEWORK

MINI HYDRO POWER

GEOTHERMAL

BIOMASS & BIOGAS

BIOFUEL

LARGE HYDRO

ENERGY EFFICIENCY

ELECTRICITY ACCESS

1

3

4

5

8

10

13

15

17

19

20

1

2

3

4

5

6

7

8

9

10

11

Page 4: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

Pe

mb

ang

kit

Lis

trik

Te

nag

a S

ury

a d

i Ban

gli,

Bal

i.

Page 5: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

• Biodiesel (B108) is a Fatty Acid Methyl Esther (FAME) or Mono Alkyl Esther

product generated from plant materials and other biomass processed using

esterification method

• Bioethanol (E100) is a ethanol product generated from plant materials and

other biomass processed using biotechnological method

• Biofuel as other means of fuel is a type of fuel generated from plant materials

and/or other organic materials, which categorized as other fuel

• Biogas is a kind of gas, which is generated as an end product of anaerobic

biomass digestion by microorganism inside digester tank with methane 40% to

70% as main component and carbon dioxide

• Biogas Power plant is a type of power plant that generates electricity by

harnessing biogas energy.

• Biomass Power plant is a type of power plant that generate electricity by

harnessing biomass energy

• COD (Commercial Operation Date) - is the running date of power plant to

provide electricity to electrical system owned by PLN

• DJK (Direktorat Jenderal Ketenagalistrikan) - is a state agency conducting duty

an responsible for formulation and implementation of policies and also

technical standardization in the electrical power sector

• Electricity Supply License (Izin Usaha Penyediaan Tenaga Listrik/IUPTL) - is a

license to conduct business in supplying electricity for the public interest

• Energy Management is integrated activities to control energy consumption in

order to achieve effective and efficient utilization of energy to produce

maximum output through economical and structured technical measures to

minimized utilization of energy including energy for production process and

minimized raw and supporting materials

ABBREVIATIONS

1PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 6: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

• EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation and implementation of policies and also technical standardization in the new and renewable energy and energy conservation sector

• Geothermal is heat based energy source contained in hot water, steam, and rocks along with associated mineral and other gasses genetically inseparable inside geothermal

• Geothermal license is a license for indirect geothermal exploitation in a specific work area

• Geothermal power plant is a type of power plant that generate electricity by harnessing geothermal power

• WKP (Wilayah Kerja Pertambangan) - is work areas with coordinative boundaries utilized for indirect geothermal exploitation

• Hydropower Plant is a type of power plant that generate electricity by harnessing the power of waters stream, waterfalls, dam, or multi purpose irrigation channels

• MEMR - is Ministry of Energy and Mineral Resources

• Micro hydro power plant is small scale power plant with less than 1 MW of capacity which may originate from irrigation channels, rivers, and natural waterfalls

• PLN (Perusahaan Listrik Negara) - is a state owned company established based on government regulation no. 23/1994 on the re-enactment of state electricity public company to limited company

• PPA (Power Purchase Agreement) - is trade agreement on electricity between holder of electricity supply license and PLN.

• Pure Vegetable oil (B100) is a product generated from plant materials processed using mechanical and fermentative method.

• Solar Photovoltaic Power Plant is a type of power plant that generates electricity by converting solar energy to electricity using photovoltaic module.

• Wind Power Plant is a type of power plant that generates electricity by harnessing wind power.

2 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 7: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

PREAMBLE

There are ranges of policies and regulations

that govern the behavior of the energy sector

and significantly impact the decisions of

producers, consumers, investors and other

stakeholders. These policies and regulations

continue to be reviewed and, in the case of

new and renewable energy, continue to be

developed to address the specific

requirements of this emerging source of clean

energy.

As with policy makers who need accurate and

up-to-date information on the factors that

influence the decision-making process of the

private sector, investors need to be kept

informed about changes to policies and

regulations. It is in this latter context that this

document has been prepared and, in order to

support the changes underway for the

clean-energy sector, these guidelines will

continue to be improved and updated on a

regular basis.

3PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 8: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

• Governs prioritization of new

renewable energy (NRE) and energy

efficiency (EE) by government and

local government

• Provides incentives and disincentives

for EE and NRE

• Establishes energy prices based on

market mechanism with subsidies

still provided for low income groups

• Establishment of National Energy

Council

• Development of National and

Regional Energy Plans

• Ratio Electrification rate to reach

100% by 2020

• National Energy Mix (23% renewable

energy, 22% gas, 25% oil, 30% coal)

by 2025

• National Energy Mix (31% renewable

energy, 24% gas, 20% oil, 25% coal)

by 2050

• Decrease Final Energy Intensity by

1% each year till 2025

http://www.den.go.id/upload /ken/ppken.pdf (accessible per 28 July 2015)

http://www.dpr.go.id/dokjdih /document/uu/UU_2007_30.pdf (accessible per 28 July 2015)

NATIONAL ENERGY REGULATORY FRAMEWORK

Regulation Description LinkKey Points

EnergyUU 30/2007

NationalEnergyPolicy

PP 79/2014

Maximizing renewable energy, minimizing use of oil, optimizing use of gas and new energy; and use of coal for domestic purposes.

Strengthening financial policy instruments. Decentralized sources of electricity. Bottom up approach. Data Governance. Connecting the

research sector with industrial sector. Capacity building.

4 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 9: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

• GoI Support to PPP projects includes non-fiscal and fiscal supports

• Non fiscal support includes licensing, land provision, partial construction support and

• Fiscal support includes tax incentives and/or fiscal contribution

http://www.sjdih.kemenkeu.go.id

/fullText/2011/56TAHUN2011PE

RPRES.htm (accessed 2 July 2015)

http://www.sjdih.kemenkeu.go.id

/fulltext/2013/225~PMK.011~2013

Per.HTM (accessed 2 July 2015)

http://www.sjdih.kemenkeu.go.i

d/fullText/2012/223~PMK.011~20

12Per.HTM (accessed 2 July 2015)

http://www.jdih.kemenkeu.go.id

/fullText/2015/18TAHUN2015PP

.pdf (accessed 2 July 2015)

PPP in Infrastructure

Provision

PP 67/2005 as amended

by PP 56/2011

Business Viability

Guarantee Letter (BVGL)

PerMen Keu 225/PMK.011/

2013

Viability Gap Fund (VGF)

PerMen Keu 223/PMK.011/

2012

Tax AllowancePP 18 of 2015

FINANCIAL INCENTIVES REGULATORY FRAMEWORK

• Income tax facility for certain line of business including NRE industry with overall requirements:

a high value investment b high absorption of manpower c high local content in its products• Reduction of net income of 30%

(thirty percent) of the investment in the form of fixed assets, charged for 6 (six) years respectively at 5% (five percent) each year as of the Commercial Operation Date

• GoI provides fiscal support to enhance the financial viability but economically viable PPP projects

• As capital expenditure in the form of cash for a certain portion of the construction cost of the PPP project

• Requirements for VGF eligibility: a economically viable yet has not

met financial viability b the project is a users pay principle

project c investment value of IDR 100

billion d the project is operated by PPP

business unit based on open and competitive tender

e PPP agreement as the basis for asset transfer

f Feasibility study

• GoI provides guarantee for PT PLN’s financial obligation under default and/or termination risk based on the PPA with IPP

• BVGL may be given to the following phase:

a during project preparation phase b during project construction phase c partial or the entire project

operation phase

LinkKey PointsDescriptionRegulation

5PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 10: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

LinkKey PointsDescriptionRegulation

• Accelerated depreciation and amortization.

• Imposition of income tax on dividends which paid to foreign tax subject

• Compensation losses longer than 5 (five) years but not more than 10 (ten) years with the certain conditions

• Exemption from import duty on the import of machines, goods and materials for production for a period of 2 years.

• Import duty facility for a period of 4 years is granted to a company using locally-produced machines at least 30% of the total value of machines for its production.

Import Duty Facility

PerMen Keu76/PMK.011/

2012as amended by PerMen

Keu 176/PMK.011

/2009

Tax AllowancePerMen Keu 89/PMK.010

/2015

Tax and Custom

Facilities for Renewable

Energy Activities

PerMen Keu 21/PMK.011/

2010

• Reduction of net income of 30% (thirty percent) of the investment in the form of fixed assets, charged for 6 (six) years respectively at 5% (five percent) each year as of the Commercial Operation Date

• Accelerated depreciation and amortization.

• Imposition of income tax on dividends which paid to foreign tax subject of 10% (ten percent), or a lower rate according to the avoidance of double taxation agreement.

• Compensation losses longer than 5 (five) years but not more than 10 (ten) years with the certain conditions (e.g.: project location in industrial/bonded zone, developing economic and/or social infrastructure, minimum 70% of local material/components, deployment of local manpower, R&D on local product development, expanded business ventures, export)

• Income tax facilities: a Reduction of net income of 30%

(thirty percent) of the investment in the form of fixed assets, charged for 6 (six) years respectively at 5% (five percent) each year as of the Commercial Operation Date

b Accelerated depreciation and amortization.

http://www.sjdih.kemenkeu.go.id/fullText/2010/21~PMK.011~2010Per.HTM(accessed 2 July 2015)

http://www.sjdih.kemenkeu.go.id/fulltext/2015/89~PMK.010~2015Per.pdf(accessed 2 July 2015)

http://www.bkpm.go.id/img/file/PMK%20No_%2076%20tahun%202012.pdf(accessed 28 July 2015)

6 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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LinkKey PointsDescriptionRegulation

c Imposition of income tax on dividends which paid to foreign tax subject

d Compensation losses longer than 5 (five) years but not more than 10 (ten) years with the certain conditions

• VAT facility: a. VAT free for importing Taxed

Goods (machineries and equipment) for Renewable Energy Import duty facility (as regulated by Permenkeu 76/PMK.011/2012 and PMK 154/PMK.011/2008 as amended by PMK 154/PMK. 011/2012

• Tax facilities borne by the GoI

• Free of Import Duty for power generation industry:

a PT PLN (persero) b Holder of Public Electricity

Business License (Izin Usaha Ketenagalistrikan untuk Kepen- tingan Umum/IUKU) which has business area

c Holder of IUKU that has signed PPA with PLN with 100% purchasing commitment or signed a Financial Lease Agreement with PT PLN (Persero)

• Requirement of Free Import Duty Goods:

a Goods not yet produced domestically

b Goods that are produced domestically yet have not met the required specification

c Goods that are produced domestically yet have not met the required quantities

*The Free Import Duty Goods must be needed in the power generation Industry

• A taxpayer can be granted a tax relief facility for a period of between 5 and 10 years, starting from the commencement of its commercial production.

• After the expiration of the tax holiday, the taxpayer will be entitled to an income tax reduction of 50% for a further 2 years.

• Duration of the tax relief and reduction can be extended based on a decision by the Minister of Finance.

http://www.sjdih.kemenkeu.go.id/fulltext/2012/154~PMK.011~2012Per.HTM (accessed 20 July 2015)

http://www.bkpm.go.id/img/file/PERATURAN%20MENTERI%20KEUANGAN%20NOMOR.pdf (accessed 28 July 2015)

Import Duty Facility for Importing

Capital Goods for the

Construction and

Development of Power

Generation Industry for

Public interest

PMK 154/PMK.011

/2008 as amended by

PMK 128/PMK.011

/209 and PMK

154/PMK.011/2012

Tax Holiday

PerMen Keu 130/PMK.01

1/2011 as amended

by PerMen Keu

192/PMK.011/2014

7PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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LinkKey PointsDescriptionRegulation

• Provides the latest pricing on hydropower plants <10MW based on the water utilization (river or multi-use facility such as irrigation canals)

• Provide a way for some types of existing projects to get a price adjustment to this new tariff

• Governs the application process for connection and the PJBL process

• Review and grid study content• Specific processes for mini hydro

(up to 10MW), waste to energy (up to 10MW), and Solar PV

• KKO/KKF/K Risk• Technical requirements• Testing and commissioning

procedures

• Projects of less than 1 MW are closed to foreign investment.

• Projects of between 1 and 10 MW are limited to a maximum 49% foreign investment.

http://ebtke.esdm.go.id/regulation/8/peraturan.menteri (accessed 25 July 2015)

http://www.bkpm.go.id/img/PP_No_39_2014.pdf (accessed 25 July 2015)http://www.bkpm.go.id/img/file/Peraturan/Bahan%20Perpres%2039%20Tahun%202014%20dan%20Perbaikan%20Kemudahan%20Berusaha-ed.pdf (accessed 25 July 2015)

http://www.pln.co.id/dataweb/pjbl/Lampiran%20Pedoman%20Penyambungan%20PLT%20EBT%20ke%20JARDIS_final_signed.pdf (accessed 28 July 2015)

The purchase of electricity from hydropower plants (hydropower) with capacity up to 10 megawatts (MW ) by the State E l e c t r i c i t y Company ( PLN Persero)

PerMen ESDM

19/2015

List of Business Fields Closed to Investment and Business Fields Open, with Conditions, to Investment

PerPres 39/2014

• Guideline on connecting renewable energy based power plants to PLN’s distribution network

KepDir PT PLN

(PERSERO) 0357.K/DIR

/2014

MINI HYDRO POWER

Regulatory Framework

Tariff – Referring to PerMen ESDM No 19/2015

12

7.5

14.4

9

River flow ≤ 10 MW

Dam existing ≤ 10 MW

Adjustment from the lastregulation EMR Ministerial

Decree Number 22 Year 2014(Hydro Power ≤ 10 MW)

Medium Voltage (cent US$/kWh) Medium Voltage (cent US$/kWh)

( 1st year to 8th year) 9.3

( 9th year to 20th year)

Low Voltage (cent US$/kWh) Low Voltage (cent US$/kWh)

( 1st year to 8th year) 11

( 9th year to 20th year)

Medium Voltage (cent US$/kWh)

10.8 ( 1st year to 8th year)

6.75 ( 9th year to 20th year)

Low Voltage cent US$/kWh)

13 ( 1st year to 8th year)

8.1 (9th year to 20th year)

8 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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Investment Flow Chart

Investors & LendersRegional

Government Developers Other Parties Central Government

Deve

lopm

ent R

ights

Pow

er Sa

les

Agre

emen

t Pr

ojec

t Con

stru

ction

Reso

urce

Ass

essm

ent

Oper

ation

and

Mai

nten

ance

Initial seed capital*developers andinvestors couldalso be in one

package

Survey and siteselection

Prepare feasibilitystudy and

other technicalrequirements

Apply for permits

Submit to PLNPLN review &acceptance MEMR approves

Process permitapplications

MEMR appointsdevelopers

Apply for temproary supply licence andremaining permints.

Submit depositcertificate to MEMR

MEMR issuestemporary supply

licencesProvide 6 month

progress report toMEMR cc: PLN and DJK

Financial close &apply supply

permanent licences

PLN & Developerfinalize PPA

PLN & Developersfinalize PPA

Loans and/oradditional equity

Purchase PowerOperate Plant

Construct and commission of plant

Receive loan repayment and

dividends

Site Preparation and contracts for constructions

PLN providesconnection standards

issue permanent supply licences

9PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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http://esdm.go.id/regulasi/uu/doc_download/ 1484-peraturan- menteri-esdm-no16-tahun- 2014.html (accessed 25 July 2015)

bumn.go.id/data/ uploads/files/1/59.pdf (accessed 25 July 2015)

prokum.esdm.go.id/uu/ 2014/UU%2021%202014.pdf (accessed 25 July 2015)

• Classified geothermal as a non-mining activities

• Central government holds the authority for geothermal licensing.

• Defines process for licensing and pricing.

• Provide regulatory assurance for developers

• Governments hold the authority to determine geothermal prices.

• Allow higher foreign shareholding limits for geothermal projects between 1 and 10 MW located in eastern Indonesia.

• Oblige developers to provide collaterals for post-production activities.

GeothermalUU No. 21/2014

Geothermal Activities

PP 59/2007 as amended by PP 70/2010

Purchase of Electricity from PLTP or Purchase of Geothermal Steam for PLTP

PerMen ESDM 17/2014

GEOTHERMALRegulatory Framework

Tariff – Referring to PerMen ESDM 17/2014

Ceiling Price (cent US$/kWh)

Note: • Region I: Sumatera, Java, Bali• Region II: Sulawesi, Nusa Tenggara Barat, Nusa Tenggara Timur, Halmahera, Maluku, Papua, Papua Barat, and Kalimantan• Region III: areas in region I & II that is isolated and most of the electricity generated is from diesel power plant

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

11.8

12.2

12.6

13

13.4

13.8

14.2

14.6

15

15.5

15.9

17

17.6

18.2

18.8

19.4

20

20.6

21.3

21.9

22.6

23.3

25.4

25.8

26.2

26.6

27

274

27.8

28.3

28.7

29.2

29.6

LinkKey PointsDescriptionRegulation

• Define ceiling prices determination method.

• Listed applied ceiling prices for geothermal until 2025.

Year of COD Region I Region II Region III

PL

TP

Kam

oja

ng

- G

aru

t

10 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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Investors & Lenders RegionalGovernment

Developers Other Parties Central Government

Deve

lopm

ent R

ight

sPo

wer

Sal

esAg

reem

ent

Proj

ect C

onstr

uctio

nRe

sour

ce A

sses

smen

tOp

erati

on an

d M

ainte

nanc

e

Investment Flow Chart - Preliminary Assignment

11PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

Page 16: TABLE OF CONTENTS - usasean.org · • EBTKE (Direktorat Jenderal Energi Baru Terbarukan dan Konservasi Energi) - is a state agency conducting duty an responsible for formulation

Investors & Lenders Regional Government

Developers Other Parties Central Government

Deve

lopm

ent R

ight

sPo

wer

Sal

esAg

reem

ent

Proj

ect C

onst

ructi

onOp

erati

on a

nd M

aint

enan

ceRe

sour

ce A

sses

smen

t

MEMR designatesWKP

MEMR conducts tender

MEMR compliesresource data

MEMR awards WKP

Initial seedcapital Submit Proposal

Applies for permits

PLN and developersfinalize PPA

PLN and developers finalize PPA

Financial Close

MEMR issuessupply license

Explorationfunding

Process permit application

Conducts exploration &prepare feasibillity study

Field development, power plant construction

and commisioning

Loans and/or additional equity

Receive production bonus

Operate plant Receive loan

repayment and dividends

Purchase Power

Receive production bonus

Investment Flow Chart - Government Designated WKP

12 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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LinkKey PointsDescriptionRegulation

• Regulate assurance of electricity purchase by state owned electricity company (PLN).

• Regulate Feed in Tariff that must be complied by PLN for electricity generated by biomass and biogas power plant less than 10 MW

• Defines process for permit licensing

• Projects of less than 1 MW are closed to foreign investment.

• Projects of between 1 and 10 MW are limited to a maximum 49% foreign investment.

• Governs the application process for connection and the PJBL process

• Review and grid study content• Specific processes for mini hydro

(up to 10MW), waste to energy (up to 10MW), and Solar PV

• KKO/KKF/K Risk• Technical requirements• Testing and commissioning

procedures

http://prokum.esdm.go.id/permen/2014/Permen%20ESDM%2027%202014.pdf(accessed 25 July 2015)

http://www.bpn.go.id/Publikasi/Peraturan-Perundangan/Peraturan-Presiden/peraturan-presiden-republik-indonesia-nomor-39-tahun-2014-4594 (accessed 25 July 2015)

http://www.pln.co.id/dataweb/pjbl/Lampiran%20Pedoman%20Penyambungan%20PLT%20EBT%20ke%20JARDIS_final_signed.pdf (accessed 28 July 2015)

Purchase of Electricity from Biomass Power plant (PLTBm) and Biogas Power Generation (PLTBg) by PT PLN (Persero).

List of Business Fields Closed to Investment and Business Fields Open, with Conditions, to Investment

Guideline on connecting renewable energy based power plants to PLN’s distribution network

PerMen ESDM 27/2014

PerPres39/2014

KepDir PT PLN (PERSERO)0357.K/DIR/2014

BIOMASS & BIOGAS

Regulatory Framework

Biomass: Rp. 1.150/kWh: Medium Voltage

Rp. 1.500/kWh: Low Voltage

Biogas: Rp. 1.050/kWh: Medium Voltage

Rp. 1.400/kWh: Low Voltage

Tariff – Referring to PerMen ESDM 27/2014

PL

T B

iog

as (P

OM

E)

13PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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Investors & Lenders RegionalGovernment

Developers Other Parties Central Government

Deve

lopm

ent R

ights

Powe

r Sale

sAg

reem

ent

Proje

ct Co

nstru

ction

Reso

urce

Ass

essm

ent

Oper

ation

and

Main

tena

nce

• http://ebtke.esdm.go.id/post/2014/09/05/664/renewable.energy.guidelines.on.biomass-biogas.development.in.indonesia (accessed 28 July 2015)

Investment Flow Chart – (< 10 MW)

Detail biomass & biogas investment guideline

14 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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LinkKey PointsDescriptionRegulation

• Obligation to mix biofuel into fuel based in stages

• Prioritization in utilizing domestic biofuel

• Government of Indonesia guarantees the availability and distribution of Biofuel

• Index Market Price of Solar and Index Market Price of Biofuel are stipulated by the Minister

• Governs types of biofuel priorities for development

• Defines process for licensing and pricing.

• Collection and Utilization of Palm Oil Plantation Fund for biodiesel implementation.

• Obligation for biofuel distribution enterprise to blend biodiesel according to regulation.

• Description of types of biofuel and on which sector it is mandatory in.

• Timeframe and percentage for biofuel provision

http://www.jdih.kemenkeu.go.id/fullText/2014/191TAHUN2014perpres.pdf (accessed 25 July 2015)

http://prokum.esdm.go.id/permen/2008/permen-esdm-32-2008.pdf (accessed 25 July 2015)

http://jdih.esdm.go.id/peraturan/Perpres%20No.%2061%20Th%202015.pdf (accessed 25 July 2015)

http://jdih.esdm.go.id/peraturan/Permen%20ESDM%2012%20Thn%202015.pdf (accessed 25 July 2015)

http://www.jdih.kemenkeu.go.id/fullText/2015/114~PMK.05~2015Per.pdf (accessed 25 July 2015)

Provision, Distribution, and Retail Prices of Fuel Oil

PerPres 191/2014

Provision, utilization and administration Biofuel

PerMen ESDM 32/2008

Collection and Utilization of Palm Oil Plantation Fund

PerPres 61/2015

The Provision, Utilization, And The Marketing Of Biofuels (Biofuels) As Other Fuels

PerMen ESDM 12/2015

Service Tariff of Public Service Agency

PerMen Keu 114/PMK.05/2015

BIOFUELRegulatory Framework

• Amount of export tax levies applied to CPO and its derivatives.

• Amount of export tax levies applied to CPO-based biodiesel.

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Investors & Lenders RegionalGovernment Developers Other Parties Central Government

Deve

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Investment Flow Chart

16 PRACTICAL GUIDE TO INVESTMENT IN RENEWABLE ENERGY

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LinkKey PointsDescriptionRegulation

• Regulates IPP procurement process consist of a) direct appointment, b) direct selection, and c) open tender

• Regulates PPA negotiation process

• Governs off-grid systems to supply consumers.

• Defines process for licensing and pricing.

• Per Law No. 23 of 2014 on Regional Government, provincial government holds the authority for licensing and pricing of off-grid systems.

• Purchase by PLN can be done by open tender, direct appointment or direct selection.

• PLN develops its owner estimate based on several standards a) local content, b) price and quality of fuel, c) exchange rate and d) other macro economy indicator.

http://prokum.esdm.go.id/permen/2007/permen-esdm-04-2007.pdf (accessed 28 July 2015)

http://prokum.esdm.go.id/pp/2012/PP%2014%202012.pdf (accessed 25 July 2015)

http://prokum.esdm.go.id/permen/2009/permen-esdm-05-2009.pdf (accessed 28 July 2015)

Power for Power Purchase and/or lease of the network in the electricity supply business for public interest

PerMen ESDM 04/2007 as

amended by PerMen ESDM

01/2006

Electricity Supply Business Activities

PP 14/2012

Guidelines For The Purchase Of Electricity By PT. PLN (Persero)Cooperation From Or Other Business Entities

PerMen ESDM

05/2009

LARGE HYDRO

Regulatory Framework

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Investors & Lenders RegionalGovernment

Developers Other Parties Central Government

Deve

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ent R

ights

Powe

r Sale

sAg

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ent

Proje

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Detailed IPP guidelinehttp://www.pln.co.id/dataweb/ipp/bookletipp.pdf (accessed 28 July 2015)

Investment Flow Chart

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LinkKey PointsDescriptionRegulation

• Governs responsibilities of government, local governments, private sectors, and the society in energy conservation

• Regulate obligation to establish new energy management system for users with consumption over 6,000TOE

• Regulate on standards and labeling.• Provide facilitation, incentives and

disincentives for energy consumer and producer of energy saving technology

• Direction and supervision of energy conservation

• Governs consumption savings for: Government buildings, State Enterprise buildings, Government officials’ residence, public lighting.

• Governs energy management and use for energy supply and utilization in which the permits was given a government body and/or an object of working agreement under a government body.

• Governs use of subsidized fuel by Government-owned vehicles, and transport vehicles of certain classes.

http://aplikasi.ebtke.esdm.go.id/pome/uploads/doc/PP%2070%202009.pdf (accessed 25 July 2015)

http://aplikasi.ebtke.esdm.go.id/popea/live/data/regulasi/1396494400.pdf (accessed 25 July 2015)

http://jdih.den.go.id/download/574/peraturan-menteri-esdm-no-142012 (accessed 25 July 2015)

http://jdih.esdm.go.id/peraturan/Permen%20ESDM%2001%202013.pdf (accessed 25 July 2015)

Energy Conservation

PP 70/2009

Energy Consumption Savings

PerMen ESDM

13/2012

Energy Management

PerMen ESDM

14/2012

Control of Oil Fuel Use

PerMen ESDM 1/2013

Regulatory Framework

ENERGY EFFICIENCY

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LinkKey PointsDescriptionRegulation

• Governs the development, utilization, supply, and distribution of Electricity

Defines delegation of authority between relevant parties

• Regulates the management and business of electricity

• Governs off-grid systems to supply consumers.

• Defines process for licensing and pricing.

• Per Law No. 23 of 2014 on Regional Government, provincial government holds the authority for licensing and pricing of off-grid systems.

• Projects of less than 1 MW are closed to foreign investment.

• Projects of between 1 and 10 MW are limited to a maximum 49% foreign investment.

• Governs technicalities on how the specific funds available from the 2015 national budget (APBN) can be utilized to fund renewable-energy-based electrical programs like Micro Hydro, Solar Mini-grid, and Solar-Wind Hybrid for village level needs.

• Aimed to provide reference for Working Units at Local level on how to tap the funds.

• Regulation specific line of coordination, distribution of tasks and responsibilities, and establish a monitoring/supervising mechanism.

http://prokum.esdm.go.id/uu/2009/UU%2030%202009.pdf (accessed 25 July 2015)

http://prokum.esdm.go.id/pp/2012/PP%2014%202012.pdf (accessed 25 July 2015)

http://www.gaikindo.or.id/wp-content/uploads/2015/05/PerPres-39_2014-lampiran-negative-list.pdf (accessed 25 July 2015)

http://jdih.esdm.go.id/peraturan/Permen%20ESDM%2010%20Thn%202015.pdf (accessed 25 July 2015)

ElectricityUU

30/2009

Electricity Supply Business Activities

PP 14/2012

List of Business Fields Closed to Investment and Business Fields Open, with Conditions, to Investment

PerPres 39/2014

Technical Guidance of Utilization of Specifically Allocated Funds in the Field of Electricity at the Village Level in the 2015 National Budget.

PerMen ESDM

10/2015

Regulatory Framework

ELECTRICITY ACCESS

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