Renewables industry asks PLN and IPP to discuss REC playbook

Jakarta – Circulars regarding the prohibition of private electricity developers or independent power producers (IPP) from selling Green Energy attributes in the form of Renewable Energy Certificates (REC) directly to the market have drawn reactions from new and renewable energy associations.

Chairman of the Indonesian Geothermal Association (API), Priyandaru Effendi said Monday (8/8), that REC can be traded and is the developer’s right according to international rules. In fact, according to international rules, buying and selling REC should be the developer’s right because they are the ones working on it.

“However, it is possible for the buyer to also get a share if the PPA is regulated like that,” he said, adding that developers could actually sell REC without any problem.

“The question is if PLN is now claiming it, can PLN sell it considering that it takes money and energy to carry out the certification process,” Effendi said.

Meanwhile, Chairman of the Association of Micro Hydro Power Plants (PLTMH), Zulfan Hilal assessed that since REC is a new product, PLN and IPPs need to sit down together to discuss REC to clarify the regulations.

In a circular letter numbered 43803/KEU.01.02/D01020300/2022 dated August 2, 2022, PLN Management said that the issuance of REC and sources of power in the PLN electricity system (both PLN and IPPs) is only carried out by PLN. Meanwhile, independent power producers (IPPs) are not allowed to sell Green Energy attributes in the form of REC directly to the market.

According to PLN’s explanation, the electrical energy produced by IPPs, including renewable IPPs, is distributed to the PLN network and is paid by PLN for each kWh production based on the contract agreement between the IPP and PLN.

“All electricity is purchased by PLN and the project’s economic viability has been guaranteed by PLN so that the issuance of REC and generator sources in the PLN electricity system (both PLN and IPPs) is only carried out by PLN and IPP parties are not allowed to attribute sales of Green Energy attributes in the form of REC on a regular basis directly to the market,” reads the circular signed by the Executive Vice President of IPP PLN I Nyoman Ngurah Widiyatnya.

The letter was addressed to 20 EBT IPPs. The twenty IPPs include; PT Pertamina Geothermal Energy, Star Energy Ltd, PT Geo Dipa Energi, Perum Jasa Tirta 2, PT Rajamandala Electric Power, PT Bajradaya Sentranusa and PT Wampu Electric Power, PT Tanggamus Electric Power, PT Binsar Natorang Energi, PT Bangun Tirta Lestari, PT Energi Sakti Sentosa and PT Supreme Energy Muaralaboh, PT Supreme Energy Rantau Dedap, Sarulla Operation Ltd, PT Sorik Marapi Geothermal, PT Poso Energy, PT Malea Energy, PT UPC Sidrap Bayu Energi, PT Energi Bayu Jeneponto and PT Sokoria Geothermal Indonesia.

“To further regulate this matter, PLN also proposes for further discussions with NRE IPP developers regarding the REC arrangement as outlined in the Power Purchase Agreement (PPA) or the Electricity Sales and Purchase Agreement (PJBTL),” PLN management wrote in the circular. (Hartatik)

Banner photo: Kindel Media/

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