Indonesia’s first pumped storage power plant to support the energy transition
The World Bank Executive Board today has one Loan of $ 380 million Development of Indonesia’s first pumped storage power plant with the aim of improving power generation capacity during peak demand and at the same time supporting the country’s energy transition and decarbonisation goals.
“The Indonesian government has committed to reducing greenhouse gas emissions through the development of renewable energies, energy conservation and the use of clean energy technologies, among other things. The reduction of emissions in the energy sector is driven by the generation of new and renewable energy and the application of energy efficiency, ”said Arifin Tasrif, Minister of Energy and Natural Resources of the Republic of Indonesia.
Over 80 percent of the electricity generated for the Java-Bali network, which powers 70 percent of the country’s population, comes from fossil fuels. An important measure to support Indonesia’s decarbonization agenda is the development of an energy storage system to enable the integration of renewable energies into the grid. Pumped storage power plants play a crucial role in this.
The financing supports the construction of the Upper Cisokan pumped storage power plant between Jakarta and Bandung with an expected output of 1,040 MW. The plant will have significant power generation capacities to meet peak demand, have significant storage capacities for greater penetration of renewable energies and, due to the proximity to two major demand centers, reduce the increasing transmission loads in the grid. As a result, consumers in Java and Bali will benefit from a more environmentally friendly and reliable power supply.
“We are excited about this project as it will be the first of its kind for Indonesia. It marks a turning point in Indonesia’s decarbonization path. The World Bank will continue to support Indonesia in its efforts to achieve resilient, sustainable and inclusive development that will benefit the Indonesian people now and in the future, “said Satu Kahkonen, World Bank Country Director for Indonesia and Timor Leste.
Pumped storage power plants use two water reservoirs at different altitudes. In times of low electricity demand or when there is abundant generation from clean energy sources such as solar energy, electricity from the grid is used to pump water into the upper basin. Electricity is generated at peak times, usually in the evening hours when water flows into the lower basin with a turbine, when the LCOE is high.
The project will help increase system flexibility and efficiency in balancing supply and demand, thereby improving the reliability and quality of electricity services in Java and Bali. In addition, the government is to be supported in integrating variable renewable energies into the Java-Bali network and in doing this in an ecologically and socially sustainable manner.