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  • Energy Policy , 
  • Oil & Gas

Indonesia industry ministry to propose mandatory domestic gas sales – minister

6 January 2020

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  • Indonesia

JAKARTA, Jan 6 (Reuters) – Indonesia’s Industry Ministry will put forward a plan for mandatory domestic gas sales to ensure local manufacturers can get cheap supplies after they complained of high prices, Industry Minister Agus Gumiwang Kartasasmita said on Monday.

The so-called domestic market obligation (DMO) would require gas producers to sell a portion of their output to local buyers at a set price, making sure local gas distributors have sufficient supplies to keep gas utility tariffs low.

The ministry will put the plan to President Joko Widodo on Monday, arguing that it will help state-controlled gas utility company PT Perusahaan Gas Negara sell gas to industries at a lower price, Kartasasmita told reporters.

“We will formulate how big the DMO will be and at what price level, but the point is gas supplied to factories should be priced below $6 per million British thermal unit (mmbtu) if possible,” he said.

Natural gas is currently sold to manufacturers at around $8-$9 per mmbtu, he said.

Indonesia in late 2016 issued a regulation that ordered energy companies to cut natural gas prices to $6 mmbtu for fertilizer, steel and petrochemical industries, however companies complained last year that the rules have not been fully implemented. (reut.rs/2ZY1Xlk)

The ministry is also considering a plan that would lower the government’s portion of gas producing contracts and allow industries to import gas if there were no gas utilities near their factories, Kartasasmita said. (Reporting by Bernadette Christina Munthe; Writing by Fransiska Nangoy; editing by Richard Pullin)

  • Energy Policy , 
  • Oil & Gas

Jokowi considers three solutions to lower industrial gas prices

6 January 2020

 – 

  • Indonesia

President Joko “Jokowi” Widodo will look into three options to lower the stubbornly high industrial gas price in Indonesia, which has deterred industries from expanding in Indonesia amid a domestic economic slowdown.

The options are: introducing a fiscal incentive, creating a domestic market obligation (DMO) or undergoing an import simplification procedure to reduce gas prices for domestic industries, the President explained.

“This problem has been going on since 2016. I need a solution, and those three are the options,” he told reporters after a closed-door limited cabinet meeting on Monday in Jakarta.

Jokowi’s adminsitration is pushing industrial development forward to revive economic growth, which has slowed to its lowest rate in more than two years: 5.02 percent in the third quarter of 2019.

By “reducing or even eliminating” the government’s share of earnings from gas sales – about US$2.20 per 1 million British thermal units (mmbtu) – Jokowi expected industrial gas prices to fall as well.

The second solution being studied, he added, was for the government to impose a DMO policy for gas producers so that prices could be maintained. The government already imposes such a policy on coal miners, who have to sell a quarter of their production domestically at less than $70 per ton.

The third possible solution was to ease imports of gas. However, the President did not specify whether this would be achieved through fiscal or non-fiscal measures.

There were seven domestic industries heavily reliant on gas, Jokowi added. These were the electricity production, chemical, food, ceramic, steel, fertilizer and glass industries, which collectively consumed about 80 percent of Indonesia’s gas supply.

“I’ve asked my ministers to carefully calculate how to make gas prices more competitive. Look at the issues from the upstream, midstream to downstream sectors,” he said.

The President has also asked for an update on the implementation of Presidential Regulation No. 40/2016 on determining natural gas prices. He said he was looking out particularly for field problems with the implementation of the regulation by the seven gas-reliant industries.

  • Others

Prof Reacts to Prabowo Subianto’s Natuna Military Base Plan

6 January 2020

 – 

  • Indonesia

TEMPO.CO, Jakarta – International law professor, Hikmahanto Juwana, form University Indonesia said that he is apprehensive about Prabowo Subianto’s idea to establish an Indonesian Natuna military base in the Riau Islands, and the country’s eastern region.

“What I am most worried about is if it would create friction over Natuna sea, especially between [state authorities], which would involve weaponry,” said the professor in a public ‘Cross Check’ discussion on facing China held in Jakarta on Sunday, January 12.

He argues that the Indonesian Armed Forces (TNI) should be strengthened first and foremost before any military base is established near one of the most disputed maritime borders.

“Maybe the TNI must be bolstered first,” he said.

However, he asserts that the TNI’s authority will only be limited to 12-miles from Indonesia’s islands as the Natuna dispute with China is within the EEZ. “They will not be able to uphold the country’s sovereignty if it’s outside the 12-mile radius,” said the professor.

HALIDA BUNGA

  • Renewables

JinkoSolar panels to power 150 MW of solar parks in Cambodia

6 January 2020

 – 

  • Cambodia

January 6 (Renewables Now) – JinkoSolar Holding Co Ltd (NYSE:JKS) will be delivering photovoltaic (PV) panels for three projects in Cambodia with a combined capacity of 150 MW.

The Chinese firms Cheetah solar panels will be installed at two PV parks in Pursat province’s Krakor district, of 60 MW and 30 MW, respectively. The third plant, with a capacity of 60 MW, will be located in the central province of Kampong Chhnang, JinkoSolar said in a press release. The manufacturer noted that this particular type of panels has an average module efficiency of 20% and is suitable for areas with high heat and humidity.

The three solar parks will be built in line with the local government’s efforts to meet the growing energy demand in the country. Estimates by state authorities show that the electricity demand in Cambodia will expand from 1.5 GW currently to 2.3 GW by 2020 and to 2.8 GW by 2021. At present, the nation covers its power needs with hydropower and coal.

  • Renewables

Some SE Asian nations dither on joining India-based solar alliance

6 January 2020

 – 

  • ASEAN

The India-headquartered International Solar Alliance’s (ISA’s) drive to co-opt countries from South-East Asia is facing problems with some countries holding back because of New Delhi’s decision to not join the Regional Comprehensive Economic Partnership (RCEP) trade deal, said two people aware of the development.

Vietnam, Malaysia, Singapore, Philippines, Thailand, Brunei, Indonesia, and Laos are yet to become a signatory of the ISA, the first treaty-based international government organization headquartered in India. Myanmar has signed and ratified the agreement, while Cambodia is yet to ratify it and has the status of observer.

This comes against the backdrop of China’s attempts to co-opt countries into its ambitious One Belt One Road initiative, a programme to invest billions of dollars in infrastructure projects, including railways, ports and power grids, across Asia, Africa and Europe.

As many as 84 countries have signed the framework ISA agreement. Of these 63 have ratified it.

Another person, who also didn’t want to be named, confirmed the development.

RCEP is a proposed free trade agreement (FTA) between the 10 member states of the Association of Southeast Asian Nations (Asean) —Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam—and its six FTA partners. Last November, India decided not to join RCEP, with the government being under intense pressure from domestic industry, farmers and political parties over fears that joining would lead to dumping of Chinese goods that could wipe out small scale industries.

Queries emailed to an ISA spokesperson on Thursday also remained unanswered till press time.

The ISA has become India’s calling card on climate change and is increasingly seen as a foreign policy tool. ISA was termed as a political project by France at the solar alliance’s second general assembly held in New Delhi from 30 October to 2 November last year.

Initially, ISA envisaged 121 sunshine countries situated between the tropics of Cancer and Capricorn as its members. Prime Minister Narendra Modi later announced the “universalization” of membership with India moving the proposal to make all United Nations members eligible for ISA membership.

India has pitched ISA as a counterweight to Vienna-based Organization of the Petroleum Exporting Countries (Opec), with fossil fuel consumers calling for a global consensus on “responsible pricing” against the backdrop of uncertain global oil prices.

  • Renewables

Vietnam to hold auctions for 400 MW of floating solar

6 January 2020

 – 

  • Vietnam

The Asian Development Bank (ADB) is helping the Vietnamese government introduce an auction scheme for solar project development which was announced in early December.

The lender, which supports floating PV development in Afghanistan, Azerbaijan and the Kyrgyz Republic has issued a tender to seek consultants to help Vietnam’s Ministry of Industry and Trade (MOIT) hold the first two pilot auctions, which will be devoted to floating PV. “This experience will be used as an input to finalize the general auction framework,” the bank said in the tender document.

The first auction, planned for this year, is intended to select a company to construct a floating PV array with a generation capacity of 50-100 MW. A second procurement round, scheduled for 2021, is planned for a 300 MW project. Both plants will be located at hydro facilities belonging to the Da Mi Hydropower Joint Stock Co division of national electric utility Viet Nam Electricity (EVN).

“The advisor [selected in the tender] will work closely with the MOIT and EVN and directly support [the] ADB,” the bank stated.

Binh Thuan project

The tender document did not specify locations for the generation sites. The initial project, however, is not the floating power plant the ADB agreed to finance with a $37 million loan in October, according to information provided to pv magazine by a spokesperson of the financial institution. The was already built by Da Mi at a man-made reservoir at Da Min’s 175 MW hydropower plant in Binh Thuan province, on Vietnam’s southeastern coast.

The 300 MW floating solar facility is likely to be deployed at the Hàm Thuận Hydroelectric Power Complex, a cascade of two hydro power stations in the Hàm Thuận Bắc district of central Vietnam.

The nation’s new auction mechanism will support large scale solar projects unable to secure a FIT contract last year. In mid-December, the MOIT asked regional governments and the EVN to suspend new approvals for large scale PV projects under the FIT scheme. Some 135 projects with a combined generation capacity of 8.93 GW had been approved under the FIT program and around 4.5 GW of them came online at the end of June, when the first phase of the country’s scheme expired.

* the article was amended on Jan. 7 to clarify that the first of the two tendered projects is not the 47,5MW floating solar project already finalized by Da Mi at its hydropower plant in Binh Thuan province, as previously reported.

  • Electricity/Power Grid , 
  • Energy Policy

Vietnam in deals to buy Laos electricity from 2021

6 January 2020

 – 

  • Lao PDR , 
  • Vietnam

HANOI (Reuters) – Vietnam’s electricity firm EVN has signed five new deals to buy electricity from Laos starting from next year, the state-run company said.

The southeast Asian nation faces severe power shortages from 2021, as demand outpaces construction of new plants, with demand expected to exceed supply by 6.6 billion kilowatt hours (kWh) in 2021, and 15 billion kWh in 2023.

Pacts signed in Hanoi over the weekend with Laos’ Phongsubthavy and Chealun Sekong groups provide for EVN to buy electricity from five hydropower plants, beginning in 2021 and 2022, EVN said.

The plants have combined capacity of 363 megawatts, it added, but gave no details.

  • Renewables

MGen unit to start work on 50-MW Philippine solar project this month – report

6 January 2020

 – 

  • Philippines

January 6 (Renewables Now) – A consortium led by Philippine power producer Meralco PowerGen Corporation, or MGen, expects to begin building works on a 50-MW solar park in Bulacan province this month, according to a top official.

Meralco PowerGen president Rogelio Singson said, as quoted by the Manila Standard, that the developer obtained the needed construction permit for the PHP-4.25-billion (USD 83.4m/EUR 74.7m) project in San Miguel in the last working day of 2019.

As announced in October 2019, PowerSource First Bulacan Solar Inc (PFBSI) signed an engineering, procurement and construction (EPC) contract for the project with SUMEC Complete Equipment & Engineering Co Ltd. MGen’s renewables arm, MGEN Renewable Energy Inc, or MGreen, holds a 40% stake in PFBSI, while PowerSource Global Holdings Corporation has 40% and Singapore’s Sunseap International Pte Ltd is the owner of 20% in the project company.

Upon completion, the San Miguel solar park will sell its output to Meralco over 20 years.

According to Singson, MGen is committed to realise 1,000 MW of renewable energy projects in the next five to seven years. Its plans include a 110-MW floating solar project in Laguna Lake.

(PHP 1.0 = USD 0.196/EUR 0.176)

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