* Indonesia’s Energy and Mineral Resources Ministry has allocated 6.19 million kilolitre (KL) of unblended biodiesel for B20 programme in 2019, Renewable Energy Director General Rida Mulyana said on Friday.
* The ministry has allocated the biodiesel to 18 fuel distribution companies to be blended and sold to users, the bulk of which allocated to state energy company PT Pertamina.
* Nineteen biodiesel producers will supply the biodiesel, including PT Musim Mas, PT SMART Tbk and units of Wilmar International Ltd.
* The allocation next year is much higher than 2018 allocation due to mandatory B20 program launched in September.
* The government allocated 1.95 million KL of biodiesel in May-December period, and 1.41 million KL in November 2017-April 2018 period. (Reporting by Wilda Asmarini Writing by Fransiska Nangoy. Editing by Jane Merriman).
With a new decree, the Indonesian Ministry of Energy and Mineral Resources has enabled the owners of residential, commercial and industrial rooftop PV systems to sell excess power to the grid. The government hopes the new provisions will result in around 1 GW of deployed PV capacity over the next three years. Doubts, however, have been raised about the attractiveness of the scheme.
Indonesia’s Ministry of Energy and Mineral Resources has issued Ministerial Decree n. 49/2018 which ensures residential, commercial and industrial PV installations are entitled to sell excess power to the grid under a net metering scheme.
The government says the new provisions will drive the installation of around 1 GW of PV systems in the country over the next three years, and savings of up to 30% on energy bills for PV system owners. The government said the new rules are intended to favor PV installation with a high self-consumption rate, and only a minimum amount of the electricity generated will be sold to utility Perusahaan Listrik Negara.
However the director of Indonesia’s Institute for Essential Services Reform, Fabby Tumiwa, told the Kontan newspaper the new rules are not attractive enough to increase volumes, as the tariff at which excess power will be sold is too low, and amounts to an investment return of only 11 to 12 years. Mr. Tumiwa told the newspaper, savings of up to 30% would amount to an investment return of seven years or less.
Indonesia is also supporting large-scale PV, through a law issued in April 2017. A number of large solar projects have been announced over the past two years, in a country that had only 80 MW of installed capacity by the end of 2016, according to the International Renewable Energy Agency.
The government of Indonesia – and the Asian Development Bank – are implementing a micro and mini-grid program for the island nation’s less electrified areas.
Indonesia wants to increase its share of renewable energies from around 14% currently, to 23% by 2025. That goal will require 14.9 GW of additional renewable energy capacity. The country has an installed power generation capacity of around 62 GW, of which only 8.5 GW comes from renewable energy sources.
JAKARTA (Reuters) – Developers will begin building a lithium battery project in Morowali, on the Indonesian island of Sulawesi, on Jan. 11, Coordinating Maritime Minister Luhut Pandjaitan said on Friday.
The $4 billion project involves investors from South Korea, Japan and China, Pandjaitan told reporters, without naming the companies involved or providing further details on the project.
“Looking at its resources, Indonesia will become the main player in lithium batteries,” Pandjaitan told reporters, referring to forecasts for surging demand for batteries for electric vehicles.
Major nickel producers have already been eyeing Indonesia’s large nickel laterite ore reserves – prized for nickel pig iron used in stainless steel production – for use in battery materials.
But nickel is also a vital ingredient for the lithium-ion batteries used to power electric vehicles, where demand is set to accelerate over coming years.
Indonesia, with reserves of both nickel and cobalt used in lithium battery cathodes, is well positioned to meet that demand amid advancements in electric vehicle technology, the minister said.
“We will control the world market,” Pandjaitain added. “We are lucky – we are starting in the third generation of lithium batteries, so it’s cheaper.”
Analysts, however, have cast doubts on how quickly such plans can be carried out, as some of the required nickel smelter technology is complicated.
The Morowali site where the proposed battery plant would be located currently has 20 nickel ore processing facilities that feed 1.5 million tonnes of nickel pig iron a year into a 3-million tonne-per-year stainless steel mill.
Chinese battery firm GEM Co Ltd said in late September that it was teaming up with four companies to invest a total of $700 million in a project to produce battery-grade nickel chemicals in Morowali.
That project would be undertaken alongside units of top Chinese lithium battery maker Contemporary Amperex Technology Ltd (CATL) and Chinese stainless steel-maker Tsingshan Holding Group.
Tsingshan, already Indonesia’s biggest nickel producer, is also leading a group seeking investors for a nickel sulphate plant in a $10 billion industrial park linked to its Weda Bay concession on the island of Halmahera, the group said in August.
The latest surprise entrant in the rush to grab a slice of the sector has been Pertamina, Indonesia’s state energy company, which may team up with state miner Aneka Tambang to make batteries.
“We hope at least by the end of 2020 or the beginning of 2021 we can produce batteries commercially ourselves,” Herutama Trikoranto, Pertamina’s senior vice president for research and technology said on Thursday.
The company has already completed a pilot project that needed to be scaled up, he said.
The Energy and Mineral Resources Ministry’s renewable energy director general, Rida Mulyana, said on Wednesday that the government expected rooftop photovoltaic solar panels to produce 1 gigawatt (GW) of electricity nationwide within three years.
On Nov. 16, Energy and Mineral Resources Minister Ignasius Jonan issued Ministerial Regulation No 29/2018 on the use of electricity produced through roof photovoltaic solar panels for customers of state-owned electricity company PLN.
“All PLN customers — households, manufacturers and commerce — could install rooftop solar panels. The final goal is energy conservation,” said Rida, as quoted by kompas.com, adding that the regulation aimed to encourage people to install solar panels.
Ministry data show that the number of PLN customers who have installed rooftop solar panels has increased 64 percent in the last 10 months.
Rida said the installation of rooftop solar panels could reduce a household’s monthly electricity bill by 30 percent. He confirmed that PLN would offset electricity a household produced with a rooftop system in excess of its own consumption from that household’s electricity bill in the following month.
“At the very least, it can reduce the electricity bills of households by 30 percent,” he added. (bbn)
JAKARTA — Indonesia says it is unlikely to meet renewable energy targets it set after the Paris climate agreement, causing critics to call for changes in government policy.
At the recent Indonesia Clean Energy Forum (ICEF) in Jakarta, Indonesian Minister of Energy and Mineral Resources Ignasius Jonan said he is pessimistic Indonesia will be able to meet its target of having 23 percent of its energy come from renewables such as solar and wind by 2025.
“I’m worried we can’t reach 23 percent. Maybe we will try until 20 percent more or less,” Jonan said
According to Fabby Tumiwa, the executive director of Institute for Essential Services Reform (IESR), Jonan’s statement reflected the current condition where development of renewable energy is stalling. In July, President Joko “Jokowi” Widodo launched two wind power plants in Indonesia, a 75 Megawatt plant in Sidrap and a 70 Megawatt plant in Jeneponto, both in South Sulawesi.
But even then, renewable energy is only 13 percent of the total electricity produced in the country, mainly from geothermal and hydro. “And for the last three years, there hasn’t been a new and significant project for renewable energy that is being developed,” Tumiwa told VOA.
FILE – A woman takes pictures of wind power plant propeller blades in Sidenreng Rappang, Sulawesi Island, Indonesia, Jan. 15, 2018.
Perception as hindrance
Tumiwa said renewable energy is still perceived as more expensive because of the intermittent nature of solar and wind power plants.
“That is actually not the case,” he added.
According to the data from the Ministry of Energy and Mineral Resources, up until the third quarter of 2018, investment in renewable energy in Indonesia was only $1.16 billion, a decrease from $1.34 billion in 2017 and $1.57 billion in 2016.
“The number shows that the renewable energy sector is not lucrative for investors,” said Tumiwa.
Dependence on coal
More than 80 percent of the energy mix in Indonesia comes from fossil fuels, with coal power plants still the main source of electricity. Based on the Brown to Green Report published by Climate Transparency, Indonesia’s state-owned utility expects coal use to double from 2017 to 2025.
FILE – Heavy equipment is seen loading coal onto a truck at PT Adaro Indonesia coal mining in Tabalong, Kalimantan island, Indonesia Oct. 17, 2017.
Adhityani Putri, the founder of Center for Energy Research Asia (CERA), said in its commitment to the Paris Agreement, Indonesia has already taken into account the plan to build a 35 Megawatt coal power plant in its Nationally Determined Contribution (NDC) on top of the 23 percent renewable energy target.
“So it has already incorporated the fact that it would be adding a lot of coal in the next 10 years to the system,” she told VOA.
According to Putri, coal power plants have become an established business process in the last two decades. “The players are known, they are comfortable with the risks. Many people benefited from the supply chains, from coal miners to the middlemen. And finally the banks are comfortable with financing coals, they don’t understand renewables, they know coal,” she added.
Putri argued that renewable energy would be cheaper even though the technology costs a little more than conventional plants. But the government put a cap on coal prices through its Domestic Market Obligation (DMO).“And on policy, the government created policies as if renewables and fossil fuels are on the same level playing field, they are not. The characteristics of both markets are different, one is transportable while (renewable energy) is site specific and more on the smaller and medium scale,” she said adding that without policies that can accommodate growth on renewable, it would be hard to attract investors and business proponents in the sector.
State Electricity Company officials walk near solar cell panels at the largest solar power plant in Indonesia, at Oelpuah village in Kupang, July 20, 2017 in this photo taken by Antara Foto.
5,000 Megawatt per year
Tumiwa asserted the Indonesian government needs to accelerate the development of renewable energy and add 35 Gigawatts to its energy mix by 2025.
“Of course if we only add 800 to 1000 Megawatts (of renewables) per year it won’t be enough. At least we need to grow 4,000 to 5,000 Megawatts per year to meet the 23 percent target,” he added.
Last week, the Ministry of Energy and Mineral Resources issued a ministerial decree no. 49/2018 on rooftop solar power plant systems to encourage people to install the system in exchange for reduced electricity fees.
Tumiwa lauded the effort but expressed skepticism on how far it can encourage the public to invest on solar rooftop. “We did a survey two months ago and found out the potential for solar rooftop in Indonesia is about 13 percent. This equals to 4.5 million household. But these early followers would invest only if they can get the benefit,” he said.
Sapura Energy Bhd president and chief executive officer Tan Sri Shahril Shamsuddin (left) says Sapura Energy seeks more collaborative opportunities and is considering several joint ventures from potential companies in the drilling segment. (NSTP Pic by ROSELA ISMAIL)
SERI KEMBANGAN: Sapura Energy Bhd is open to partnerships with global corporations for its drilling segment and is currently in talks with several potential partners.
Its president and chief executive officer Tan Sri Shahril Shamsuddin said Sapura Energy seeks more collaborative opportunities and is considering several joint ventures from potential companies in the drilling segment.
“We are in talks with several foreign companies that approached us, and we are still looking for the best potential partnership with the best price.
Also present was Sapura Energy chairman Datuk Hamzah Bakar.
Shahril said to date, Sapura Energy owns 16 assets under its drilling segment that can be used for a period of 15 to 20 years.
“The utilisation rate for these assets is now at 35 per cent, accounting for about six to seven assets,” he said.
Meanwhile, Shahril said Sapura Energy has received shareholders’ approval for its proposed rights issue to raise RM4 billion.
The fund injection exercise is expected to create better value for shareholders and return the company to profitability amidst improved opportunities for growth.
The company plans to use the proceeds from the rights issue to reduce its estimated RM16 billion debt and allow it to have greater financial flexibility besides a stronger balance sheet.
Once Sapura Energy successfully raises the funds, it would save about RM174 million per annum in interest payments on borrowings and reduce net gearing to 0.94 times.
The rights issue exercise will also increase the number of company shares to 15.98 billion shares from 5.99 billion shares, with a further expansion to 19.37 billion shares once the Islamic redeemable convertible preference shares (RCPS-i) in the company and free warrants are fully converted.
As at the end of November 2018, its order book stands at RM18.2 billion with prospects for more, including its latest accomplishment on being selected to participate in Saudi Aramco’s Long-Term Agreement programme for engineering, procurement, construction and installation work.
Yesterday, NYK and MTI Co. Ltd. have reached an agreement to participate in a long-term demonstration of tidal energy being sponsored by MAKO Energy Pte. Ltd.* and Sentosa Development Corporation**, which will provide the demonstration site. The demonstration will start next spring in a first-time attempt to commercialize tidal energy in Singapore.
1．Background
In accordance with the NYK Group’s medium-term management plan “Staying Ahead 2022 with Digitalization and Green” that NYK announced in March, the company is taking steps to create new value through Green Business and the like.
The NYK Group has already implemented environmentally friendly initiatives at finished-car logistics terminals. Solar panels have been installed, LED port lights have been introduced, water used to wash cars is being recycled, and wind turbines are under construction. By implementing wind power generation, the Group gets one step closer to its goal of operating “green” terminals. The Group is thus participating in this demonstration to acquire additional technical expertise in the renewable energy field.
2．About the demonstration
This is the first demonstration of tidal energy to be undertaken in Singapore. MAKO Turbines will be installed under the Sentosa Boardwalk — i.e., the bridge between the Singapore mainland and the island of Sentosa — and for two years the power generation efficiency, the cost of power generation, and storage will be examined.
3．Future
The NYK Group will collaborate with MAKO Energy Pte. Ltd. and other partners*** in this research. The group then aims to contribute to the sustainable development of society and enrichment of the company’s corporate value by creating next-generation green business.
* MAKO Energy Pte. Ltd.
MAKO Energy is the Singapore-based subsidiary of Elemental Energy Technologies Ltd., a tidal turbine developer that has interest and expertise in the area of renewable energy solutions, particularly tidal power and its applications.
** Sentosa Development Corporation
A statutory board under the Ministry of Trade and Industry of Singapore, which oversees the development, management and promotion of the island as a resort destination for locals and tourists.
There are about 30 vessels currently flagged as floating storage globally, two-thirds of which are in Asia, the biggest LNG consuming region, according to cargo-tracking company Kpler SAS. PHOTO: REUTERS
SOME liquefied natural gas (LNG) sellers aren’t in a rush to deliver their multimillion-dollar cargoes.
With uncertain demand and no signs yet of bitter cold, some traders are preferring to keep their fuel inside vessels in the hope prices will rise. While the sight of stationary cargoes might not be unusual in the more-established oil market, technology has only recently made it feasible to keep LNG at minus 162 degrees Celsius for longer periods.
“There are cargoes parked close to Singapore, apparently waiting for the right market conditions to be delivered,” said Dumitru Dediu, an associate partner at McKinsey Energy Insights, which monitors LNG flows. “Some of the players are speculating.”
There are about 30 vessels currently flagged as floating storage globally, two-thirds of which are in Asia, the biggest LNG consuming region, according to cargo-tracking company Kpler SAS. That’s still a fraction of a global fleet of more than 500 vessels.
The practice of using tankers as floating storage is common in the more developed oil market. It happens during periods of contango – when storage on land is used up, immediate demand is weak and the cost for later delivery is high enough to cover the expense of storing crude on a tanker.
Trading houses and oil majors from Vitol Group and Glencore to BP and Royal Dutch Shell collectively made billions of dollars from 2008 to 2009 stockpiling crude at sea. At the peak of the floating storage spree, sheltered anchorages in the North Sea, the Persian Gulf, the Singapore Strait and off South Africa each hosted dozens of supertankers.
LNG, the fastest-growing fossil fuel, is starting to resemble the oil market in that sense. Holding it back is that some LNG is lost to keep it cool during its journey, known as boil off, and that most sales are through traditional long-term contracts without destination flexibility.
But that’s rapidly changing. Modern tankers are capable of serving as floating storage, especially for markets such as China that lack that capacity. They have lower boil-off rates, bigger capacity and re-liquefaction units on board to keep the cargoes cool.
The global LNG fleet has transportation capacity of about 44 million tonnes, which pales beside the 372 million tonnes of the crude oil tanker fleet, according to Clarkson Research Services, a unit of the world’s biggest shipbroker. LNG tankers working as storage can tie up transport capacity, even if volumes are not significant in a global context, Alastair Maxwell, chief financial officer of LNG ship owner and operator GasLog, said earlier this month.
The biggest contributor to flexible supplies is the US, where destination-free LNG exports started in 2016. The nation is adding production terminals and will compete with Australia and Qatar for a top place in LNG trade, which the International Energy Agency expects will overtake volumes delivered by pipelines in the middle of the next decade.
Developers of US LNG export projects will be among key speakers at the annual CWC World LNG Summit which starts on Tuesday in Lisbon and gathers executives and traders of the super-chilled fuel.
If a cold snap suddenly comes and the spot price rises, a well-diversified player storing fuel may boost earnings by US$2 million to US$5 million, despite current high shipping rates and boil off, Mr Dediu said.
“Playing contango on LNG has not been traditionally popular, but given the price volatility for gas we do see a lot more players doing this,” he added. BLOOMBERG
