Cirebon power station

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Cirebon power station is a 660-megawatt (MW) coal-fired power plant in West Java Province, Indonesia.

An additional 2,000 MW is under development.

Location

The undated satellite photo below shows the plant, which is located in Kanci Kulon Village, Astanajapura District, Cirebon Regency, West Java Province.

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Background on Plant

The Cirebon power station is a single-unit, 660-MW coal-fired power plant developed by Cirebon Electric Power (CEP) in the Kanci area to the southeast of Cirebon, Indonesia.[1] CEP is a joint venture between four companies: Japan-owned Marubeni Corporation (32.5%), Korea Midland Power Co (27.5%), South Korean company Samtan Co Ltd (20%) and Indonesian company PT Indika Energy (a subsidiary of the Indika Group) (20%).

Like other IPPs in Indonesia, the plant will sell the electricity produced to the PLN at an agreed feed-in tariff price. The initial agreed rate was reported to be US 4.43 cents per kWh (USD 0.0443/kWh) although, because of high coal prices, it was reported that the PLN would adjust the purchase price upwards to US 5.2 cents per kWh (USD 0.052/kWh).

The first unit of the plant was launched in mid October 2012. The reported cost of the plant was nearly $850 million. Construction began in 2008 and was completed in mid-2012. Sales from the plant to the Indonesian state-owned electricity company PLN began in July 2012.[1]

Description of Expansion

There are plans to extend the Cirebon plant with the installation of an additional 1,000-MW unit, costing around US $2 billion.[1] In November 2013, CEP announced that it was set to start the construction of the plant's second unit, which will provide an additional power supply of 1,000 megawatts (MW) in 2014, with completion targeted for 2018.[2] This plant is also shown in PLN's 2013-2022 long-range plan with a 2018 completion. [3] Funding for the project would come from loans from the Japan Bank for International Cooperation and the Export-Import Bank of Korea.[4]

In December 2014, government officials allocated land for the project. At that time, construction was planned to begin in 2015, with completion in 2020.[5]

In April 2015 project co-sponsor Indika withdrew from the power station, citing financial difficulties.[6]

In May 2015 PT Cirebon Energi Prasarana (CEPR), the developer of Cirebon II power plant, said construction of Cirebon II would begin near the end of 2015,[7] later pushed to January 2016.[8]

In March 2016 Director of Corporate Planning of PLN Nicke Widyawati said PLN expects to begin construction of the plant within the month.[9]

In May 2016 it was reported that initial construction prep on unit 2 was underway, and a 1,000 MW ultra-supercritical unit 3 was planned.[10]

In December 2016 a legal challenge to the project was filed by The People for Environmental Protection (RAPEL), with legal representation by the Advocacy Team for Climate Justice. At the heart of the legal challenge was RAPEL’s claim that local planning law only permitted power plant development in the district of Astanajapura, and that the Cirebon 2 expansion also extended into Mundu district, which was zoned for local livelihoods. ON April 19, 2017, the regional court in Bandung ruled the environmental permit for the plant was issued illegally.[11]

A coalition of Japanese groups are calling on JBIC to immediately review and repeal its decision to provide financing for Cirebon 2, saying the project is illegal according to local law and in violation of the “JBIC Guidelines for Confirmation of Environmental and Social Considerations,” which require “the compliance with environmental laws of the host nation and local governments concerned” and “the submission of environmental permit certificates issued by the host governments.”[12]

Financing

In May 2016 a press article lists a consortium of five banks (ING, Crédit Agricole, Mizuho, SMBC, MUFG) set to provide a US$640 million loan to the project, aiming to reach financial close by the beginning of the third-quarter of 2016. The export credit agencies Exim Bank of Korea, JBIC, and Nippon Export and Investment Insurance (NEXI) are also considering financing for the project.[13]

In April 2017, a loan agreement was made to provide US$1.6 billion for Cirebon 2. The Export Credit Agencies Japan Bank for International Cooperation (JBIC) and the Export–Import Bank of Korea (Kexim) will provide 60% of project debt (US$960m). Private banks will provide the remaining 40% of project debt (US$640m), including ING Bank, Mitsubishi UFJ Financial Group, Mizuho Bank and Sumitomo Mitsui Banking Corporation. The loan is being insured by the Nippon Export and Investment Insurance (NEXI).[14] The lead arrange of finance for the project is the global Dutch bank ING, which rejected pressure to withdraw from its role despite adopting a policy in November 2015 that it would reduce its exposure to coal projects.[11]

Opposition to Plant

Protests from the community in relation to its land acquisition status delayed initial operation of the plant.[1]

In December 2016 a legal challenge to the project was filed by The People for Environmental Protection (RAPEL), with legal representation by the Advocacy Team for Climate Justice. At the heart of the legal challenge was RAPEL’s claim that local planning law only permitted power plant development in the district of Astanajapura, and that the Cirebon 2 expansion also extended into Mundu district, which was zoned for local livelihoods. ON April 19, 2017, the regional court in Bandung ruled the environmental permit for the plant was issued illegally.[11]

Project Details

  • Sponsor: PT Cirebon Electric Power (CEP)
  • Parent company: Marubeni Corporation (32.5%), Korea Midland Power Co (KOMIPO) (27.5%), Samtan Co Ltd (20%), Indika Group (20%)
  • Location: Kanci Kulon Village, Astanajapura District, Cirebon Regency, West Java Province, Indonesia
  • Coordinates: -6.7702857,108.6148578 (exact)
  • Status: Unit 1: Operating (2012), Unit 2: Pre-permit development, Unit 3: Announced
  • Gross Capacity: Unit 1: 660 MW, Units 2-3: 1000 MW
  • Type: Supercritical (Unit 1); Ultra-Supercritical (Units 2-3)
  • Start date: 2020 (Unit 2)
  • Coal Type:
  • Coal Source:
  • Source of financing: Cirebon 2: Japan Bank for International Cooperation (JBIC) and the Export–Import Bank of Korea (Kexim) (US$960m); ING Bank, Mitsubishi UFJ Financial Group, Mizuho Bank and Sumitomo Mitsui Banking Corporation (US$640m).

Articles and resources

References

  1. 1.0 1.1 1.2 1.3 Cirebon power plant on stream for Java and Bali, Amahl S. Azwar, The Jakarta Post, 19 October 2012.
  2. "New 1,000 MW-power plant to be built in Cirebon" Anggi M. Lubis, The Jakarta Post, Jakarta, November 13, 2013.
  3. “PLN Long Term Electricity Plan (2013-2023),” presentation by Moch. Sofyan, Head of New & Renewable Division of PT PLN (Persero), 06 March 2014
  4. Pembangunan PLTU Cirebon Unit 2 Ditargetkan Pertengahan 2014, Berita Satu, 5 Dec. 2013.
  5. Utilisasi Kerja Sama Pemanfaatan BMN KPKNL Jakarta II: Kerjasama Pemanfaatan untuk Proyek PLTU Cirebon Jawa Barat, Direktorat Jenderal Kekayaan Negara website, 11 Dec. 2014.
  6. Anggi M. Lubis, "Indika cancels Cirebon power plant project," The Jakarta Post, April 30 2015
  7. "Cirebon II Steam Power Plant Construction to Start by Year-end," Tempo, May 12, 2015
  8. "Pembangunan PLTU Cirebon II Harus Negosiasi Ulang dengan Pendana," Tribun Jabar, 2 July 2015
  9. "PLN expects to soon start construction of PLTU Jawa 7, PLTU Cilacap, PLTU Cirebon," RambuEnergy, March 1, 2016
  10. "Marubeni, Partners To Build New Power Plant In Indonesia," Asia Power, 24 May 2016
  11. 11.0 11.1 11.2 Bob Burton, "Embarrassment for Japanese Government bank as court rules coal plant’s permit illegal," EndCoal, Apr 19, 2017
  12. "Cirebon Coal-fired Power Plant Projects, West Java, Indonesia," FOE Japan, Apr 17, 2017
  13. "Cirebon 2 coal fired power plant," BankTrack, accessed Dec 2016
  14. "Cirebon 2 (1,000MW)," Market Forces, accessed Apr 2017

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