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Indonesia is expediting the closure of a 660-MW coal-fired power plant nearly seven years ahead of schedule, media reported, citing an agreement reached by the Indonesian government, the Asian Development Bank (ADB) and an independent power producer Cirebon Electric Power (CEP).
The nonbinding framework agreement was signed during the COP28 summit in Dubai, UAE, as part of the ADB's Energy Transition Mechanism (ETM) program.
Under the agreement, the Indonesian state-owned power utility PLN, ADB, CEP, and the Indonesia Investment Authority (INA) will shorten the operational life of the Cirebon-1 power plant from originally planned July 2042 to December 2035. The power purchase agreement will also be adjusted accordingly, which is expected to be finalized in the first half of 2024.
Typically, coal-fired power plants have an average life of 40 years or more. By closing Cirebon-1 early, which was commissioned in 2012, more than 15 years of greenhouse gas emissions will be avoided.
ADB President Masatsugu Asakawa said that this is a significant development for Indonesia's energy transition, which may lead to a substantial reduction in greenhouse gas emissions.
Darmawan Prasodjo, president and director of PLN, stated that the company is committed to leading Indonesia's energy transition towards achieving net-zero emissions equitably and cost-effectively.
PLN has made significant efforts in decarbonization by canceling 13.3 GW of planned coal-based power plants, terminating a power purchase agreement of 1.3 GW, and halting the development of new coal-fired power projects.
In September 2023, Reuters reported that PLN is planning to construct 32 GW of renewable projects and invest in transmission systems to facilitate the integration of renewable energy sources. This is part of PLN's strategy to reduce reliance on coal and expedite the adoption of renewables in the country.
(Writing by Riley Liang Editing by Emma Yang)
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