High Economic Cost Hampers Geothermal Development

If the completion of the project can be accelerated, for example to seven years, the economic viability would be better and the selling price of geothermal power will be more competitive.

KOMPAS/IWAN SETIYAWAN

Workers perform maintenance at the turbine house of the Kamojang Geothermal Power Plant (PLTP) in Bandung Regency, Wednesday (29/9/2021).

JAKARTA, KOMPAS — High economic costs have hampered the development of geothermal energy in Indonesia. Of the country’s estimated geothermal energy potential of about 23,900 megawatts (MW) only about 2,175 MW have so far been developed to produce electricity.

Regarding the non-optimal development of geothermal power plants (PLTP) in Indonesia, the president director of the Indonesian Geothermal Association, Prijandaru Effendi, said that there were two main reasons that hampered their development. First, there is a gap between the selling price of electricity offered by the developers based on their economic viability, and the purchasing power of state electricity company PLN . Second, the existing regulations have not supported the acceleration of geothermal development.