BUSINESS

ADB, Indonesian partners ink MoU to accelerate retirement of coal power plant

14/11/2022 02:39 PM

JAKARTA, Nov 14 (Bernama) -- The Asian Development Bank (ADB) and its key partners in Indonesia have signed a memorandum of understanding (MoU) to jointly explore the early retirement of the first coal-fired power plant owned by independent power producer Cirebon Electric Power (CEP).

ADB today inked the MoU with CEP, Indonesia’s state electricity company PT Perusahaan Listrik Negara (PLN), and the Indonesian Investment Authority (INA) to plan for the retirement of CEP’s plant Cirebon-1, a 660-megawatt (MW) plant in West Java.

The signing, which took place on the sidelines of the G20 Leaders’ Summit in Bali, will open discussions to speed up the plant retirement in line with Indonesia’s energy transition toward net zero emissions.

“Once a definitive agreement is reached among the parties, it is anticipated that ADB would provide an early retirement facility in the form of senior debt, on the condition that the tenor of the power purchase agreement between CEP and PLN will be shortened,” the regional development bank said in a statement.

The planned transaction under ADB’s energy transition mechanism (ETM) seeks to retire existing coal-fired power plants on an accelerated schedule and replace them with clean power capacity to help Asia and the Pacific mitigate the worst impacts of climate change, it said.

ADB said that the MoU was signed at an event in which Indonesia launched its ETM country platform, a government financing and investment framework that will fund and manage the country’s energy transition activities.

The bank also signed an additional MoU with the special mission vehicle under Indonesia’s Ministry of Finance, PT Sarana Multi Infrastruktur, to provide support, including staff resources and capacity building for the platform.

-- BERNAMA

 


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