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Powering Indonesia’s Future with Geothermal Energy

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15 Jan, 2025

This post was originally published on Climate Links

Powering Indonesia’s Future with Geothermal Energy
jschoshinski
Tue, 01/14/2025 – 16:19

Indonesia ranks second behind the U.S. in installed geothermal capacity and is home to some of the world’s largest geothermal reserves. However, despite its vast geothermal potential, Indonesia faces challenges in securing financing and navigating regulatory hurdles for large-scale geothermal projects. One such project, the Ijen geothermal power plant in East Java, experienced delays after initial agreements in 2013, with investors pulling out and development stalling. Given Ijen’s importance in the nation’s energy transition and its inclusion in Indonesia’s 10-year Electricity Supply Business Plan, it was critical that the project secure funding to help Indonesia meet its clean energy goals.  

USAID played a pivotal role in overcoming these barriers by providing essential transaction advisory services to the project financing lender Indonesian infrastructure bank PT Sarana Multi Infrastruktur (PT SMI). Through the USAID Sustainable Energy for Indonesia’s Advancing Resilience (USAID SINAR) activity, USAID provided legal due diligence, identified development risks, and prepared term sheets, facility agreements, and corporate approvals. With the Agency’s support, the Ijen project is expected to leverage $227 million in financing and achieve generation capacity of 110 MW, helping to strengthen Indonesia’s energy security. 

In 2024, the U.S. International Development Finance Corporation (DFC) announced a commitment of up to $126 million for Indonesian geothermal developer PT Medco Cahaya Geothermal (MCG) to support the first phase of development at Ijen. DFC’s commitment  is in cooperation with PT SMI, which signed its own financing agreement with MCG in 2023.  

The first phase of the Ijen geothermal project, which will generate 31 MW of renewable energy capacity to the interconnected Java-Bali grid, is now on track for commercial operation by the end of this month. Once operational, the plant will provide a low-carbon energy source to two of the country’s most populous regions, helping Indonesia reduce its reliance on coal and decrease its carbon emissions. This achievement aligns with USAID’s regional priorities of advancing clean energy, reducing greenhouse gas emissions, and enhancing energy resilience in Southeast Asia.

The success of the Ijen geothermal project highlights the importance of transaction advisory services, innovative financing, and strategic partnerships in overcoming financial and regulatory hurdles for renewable energy projects. Innovative financing leverages U.S. Government, Government of Indonesia, and private sector investments to support the development of renewable energy infrastructure, ultimately advancing the energy transition towards a more sustainable future. Future energy transition efforts in Indonesia will benefit from similar approaches, emphasizing the need for strong public-private partnerships and clear legal frameworks to accelerate the deployment of advanced energy technologies.

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The USAID Sustainable Energy for Indonesia’s Advancing Resilience (USAID SINAR) activity provided support to the Ijen project, which is expected to leverage $227 million in financing and achieve generation capacity of 110 MW.

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Tue, 01/14/2025 – 12:00

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ABB receives EPD status for gearless mill drive ring motor

ABB receives EPD status for gearless mill drive ring motor

ABB has gained Environmental Product Declaration (EPD) status for its Gearless Mill Drive (GMD) ring motor — technology used to drive large grinding mills in the mining industry.

An EPD is a standardised document that provides detailed information about the environmental impact of a product throughout its life cycle. Based on a comprehensive Life Cycle Assessment (LCA) study, the EPD highlights ABB’s commitment to transparency, environmental responsibility and supporting customers in making informed decisions on sustainability in their supply chains.

ABB analysed the environmental impact of a ring motor across its entire life cycle from supply chain and production to usage and end-of-life disposal. The study was conducted for a ring motor of a semi-autogenous grinding (SAG) mill with an installed power of 24 MW and was based on a reference service life of 25 years.

“Sustainability is at the core of our purpose at ABB, influencing how we operate and innovate for customers,” said Andrea Quinta, Sustainability Specialist at ABB. “By earning the Environmental Product Declaration for our ring motor, we emphasise our environmental stewardship and industry leadership for this technology. We adhered to the highest standards throughout this process, as we do in the ABB Ring Motor factory every day. This recognition highlights to the mining industry what they are bringing into their own operations when they work with ABB.”

The comprehensive LCA was conducted at ABB’s factory in Bilbao, Spain, and was externally verified and published in accordance with international standards ISO 14025 and ISO 14040/14044. It will remain valid for five years.

The ring motor, a key component of the GMD, is a drive system without any gears where the transmission of the torque between the motor and the mill is done through the magnetic field in the air gap between the motor stator and the motor rotor. It optimises grinding applications in the minerals and mining industries by enabling variable-speed operation, leading to energy and cost savings.

The full EPD for the ABB GMD Ring Motor can be viewed on EPD International.

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