ADB Backs Clean Power in Indonesia

The Asian Development Bank (ADB) announced on Monday that the first drawdown of funds under a private sector financing package totaling more than US$305 million (FJ$653.80m) invested in Jawa-1, Indonesia’s largest combined-cycle gas turbine (CCGT) power plant.

“ADB is a partner of choice in Indonesia’s strategy to finance low-carbon power generation through private sector participation,” said Michael Barrow, director general for ADB’s Private Sector Operations Department.

He said the project will support Indonesia’s efforts “to strengthen the liquefied natural gas (LNG) supply chain and increase energy security while helping to reduce power generation costs.”

The project comprises a 1760-megawatt CCGT power plant and ancillary infrastructure

in Cilamaya, Karawang, West Java, according to ADB in a statement.

ADB’s financing package includes a direct loan of $US185 million (FJ$396.57m), and a parallel loan of $US$120 million provided by Leading Asia’s Private Infrastructure Fund (LEAP), which is administered by ADB. The Manila-based bank lender said Jawa-1 will be one of the first and largest projects in Indonesia using LNG, demonstrating the government’s commitment to reduce dependency on coal and diesel fuel in favour of cleaner domestic energy sources such as natural gas. ADB said the project is expected to help Indonesia avoid 1.77 million tons of carbon dioxide emissions. Jawa-1 is expected to power 11 million Indonesian households from 2021, supporting the country’s 100 per cent electrification target by 2024, according to ADB.

“The project will create about 4,800 jobs during construction and 125 jobs when the plant is operational,” the statement read, adding it will also offer opportunities to improve women’s livelihoods through targets for women’s employment and training on livelihood and skills development to be monitored by ADB. LEAP is one of ADB’s co-financing vehicles dedicated to private sector infrastructure in Asia-Pacific.

Xinhua