May 29 (Renewables Now) – The Asian Development Bank (ADB) said Thursday it has given the thumbs-up to a loan of USD 300 million (EUR 272m) for a 110-MW geothermal project in Java, Indonesia.
The project is being developed by state-owned geothermal energy company PT Geo Dipa Energi (GDE) and involves the construction and commissioning of two geothermal plants at Dieng and Patuha, in Central and West Java, respectively. Recognised as a National Strategic Project, it is expected to reduce the annual carbon dioxide (CO2) emissions on the Java–Bali electricity grid by over 700,000 tonnes.
Indonesia’s geothermal potential is estimated to be 29 GW. The country already ranks second globally in terms of installed geothermal power generation capacity with its 2.1 GW. The high cost and risk associated with the exploration phase in new geothermal projects, however, is slowing down the expansion of local capacity, the ADB noted.
In addition to the loan of USD 300 million, the bank will also manage a Clean Technology Fund loan of USD 35 million for GDE’s project.
“ADB’s geothermal project will help Indonesia combat climate change and make its electricity system more sustainable, reliable, and efficient. It will also help businesses and consumers access affordable, reliable, and modern energy,” said Winfried Wicklein, the bank’s Country Director for Indonesia.
(USD 1 = EUR 0.91)