PLN gets USD500m loan from NEXI to run JETP

Jakarta – PT PLN (Persero) will implement the Just Energy Transition Partnership (JETP) scheme for net energy financing, with the support of a USD 500 million loan guarantee from the Nippon Export and Investment Insurance (NEXI). The state electricity company said, this support is a follow-up to the cooperation of both parties in running the decarbonization program.

PLN Managing Director, Darmawan Prasodjo said, in the first stages, NEXI would disburse loan guarantees of USD 200 million. This loan guarantee support is specifically for net energy projects and decarbonization agendas conducted by PLN in order to achieve Net Zero Emission in 2060. “In addition to the loan guarantee, there will also be cooperation in technology related to clean energy,” Prasodjo said in a written statement this week.

He said the collaboration is in line with the LEAD NEXI initiative to facilitate decarbonization in Indonesia. Launched in December 2020, LEAD or leading technologies & businesses, environment & energy, alliance and development, is an initiative that seeks to underwrite insurance with a total value of 1 trillion yen (US$7.3 billion) by the end of fiscal 2025, improve industrial competitiveness in carbon-neutral and digital fields, and contribute to solving social issues and the United Nations’ Sustainable Development Goals.

NEXI Chairman and CEO Atsuo Kuroda said, this MoU will consolidate PLN and NEXI cooperation in the electricity sector in Indonesia. In particular, cooperation facilitates the supply of energy transition, economic development, and supporting realistic decarbonization in Indonesia. “NEXI will support decarbonization efforts in the Indonesian electricity sector by increasing collaboration between NEXI and PLN,” Kuroda explained.

A Memorandum of Understanding (MoU) on cooperation in the field of guarantee and export credit insurance was agreed between NEXI and PLN on April 25, 2022. It was then amended first on 15 November 2022.

PLN targets a reduction in emissions to 9.8 million tons CO2 in 2030. In relation to that, PLN will run an agenda in reducing emissions through co-firing technology in 52 PLN coal-fired power plants. Until 2025 PLN requires up to 10.2 million tons of biomass to be able to meet the needs of co-firing. PLN will also develop new and renewable energy powered generators and will dominate the energy mix up to 52 percent. (Hartatik)

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