Kayan Hydro Energy resuming 9,000-MW hydropower project

Jakarta – Kayan Hydro Energy (KHE) is resuming the development of the 9,000-megawatt (MW) hydropower power project in North Kalimantan after it has cleared up a legal dispute, Chief Executive Officer Andrew Suryali said.

“Now we can continue the works at the Cascade 1,” Suryali said.

The Jakarta Administrative Court recently ruled that KHE is the only company that has the permit to develop hydropower project in the Kayan River, annulling two other permits of two companies.

It was unclear how the two other companies obtained their permits. But, disputes like this are not uncommon in Indonesia due to the lack of legal clarity, analyst said.

KHE initiated in 2008 the Kayan Cascade project, which will consist of five dams along the Kayan River and equipped with five to six turbines.

The company in October 2022 signed an agreement with Sumitomo to co-develop the project, which is estimated to need around USD 17.8 billion in total investment. Prior to the agreement with Sumitomo, KHE had signed an agreement with China Power on 16 August 2019 for the same project, local media reported.

Yet, the company is still receptive to onboarding other investors into the mega project, t. It will prioritise potential investors who have already held talks with it or those who will be introduced by its partners, Suryali stated.

Initial infrastructure works have been done and KHE plans to start constructing the first dam diversion channel this year, Suryali had said on the sidelines of the KHE-Sumitomo signing ceremony on 6 October in Jakarta.

The first plant will have 900-MW capacity; the second, 1,200MW; while the third and fourth will have 1,800 MW each, and the fifth 3,400 MW. The first project is expected to be completed in 2025 or 2026, depending on weather conditions, said KHE’s Director of Operations Khaeroni.

KHE hoped to complete the rest of the project in two to three years after the completion of the first generation plant.

The power plants will supply electricity to the green industrial estate and an international sea port in North Kalimantan being developed by Indonesia Strategis Industri and other clients in Kalimantan, KHE said in a statement.

This is also part of the government’s goal for net zero emission in 2060. (I Made Sentana)

Banner photo: Sketch of Kayan Hydropower Project (Dok Dinas ESDM Kalimantan Utara)

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