Cost Recovery for Geothermal Projects

Summary

The government plans to revise the geothermal contract scheme from the base tariff or the selling price of electricity from the operator to PT PLN to a cost recovery system. The Director-General of New Renewable Energy and Energy Conservation of the Ministry of Energy and Mineral Resources, FX Sutijastoto, said the scheme is expected to attract investors because it could reduce project risks.

So far, geothermal field operators must explore with considerable risk, since they do not necessarily find geothermal reserves and there is no certainty of sales, thus causing the lack of investor interest or forcing investors to sell electricity at high prices to cover the risk. With the cost recovery, the government will reimburse exploration costs, thereby reducing investors’ burden.

Start your free trial.

If you would like to get a 30-day free unlimited access to all of our insights, please click “Start free trial” button below. If you already have an account, please login.

What do subscribers receive?

As a subscriber, you’ll receive daily insights, weekly business digests, and bimonthly industrial reports.

What kind of pieces will i get?

In-depth reports on assumption and impact analysis, as well as update and trends mapping, written by our credible and experienced analysts.

And, there is something else…

Enjoy a 30-day free trial, on us. Feel free to contact us with any additional questions you have.