Indonesia
is said to have the world's largest geothermal energy reserves but their
potential remains mostly untapped. That could soon change with German know-how.
With 240
million people, Indonesia is the biggest and fastest growing market in
Southeast Asia. And as the country's economy grows, so, too, does its demand
for electricity.
President
Susilo Bambang Yudhoyono is a self-acclaimed fan of "green energy."
In a meeting with German Chancellor Angela Merkel during her recent visit to
Indonesia, Yudhoyono talked about one of his major goals: to give greater focus
to alternative energy resources such as wind, solar and, in particular,
geothermal heat.
Untapped
resources
Volcanic
areas, like Indonesia, are a rich source of geothermal energy. The island
nation is situated on the so-called "Ring of Fire" volcanic belt,
which encircles the Pacific Ocean, accounting for 40 percent of the world's
geothermal reserves - more than any other country.
 |
| Indonesia lies in Pacific's volcanic 'Ring of Fire' |
The
government has pinpointed 250 locations where geothermal energy can be
produced, including Seulawah on Sumatra, Ijen on Java and Tomohon on Sulawesi.
Today, just 15 geothermal plants are in operation, with the last one going live
in 1997.
Not all
geothermal fields, however, are suited for commercial energy use because they
don't have the right temperature, pressure or permeability.
"With
geophysical, geochemical and geological tests, you try to get a picture of what
it looks like inside the Earth," says Thorsten Schneider from Germany's
KfW Entwicklungsbank in Jakarta.
After the
test, drilling begins, representing a huge financial risk, according to
Schneider. "A typical drilling costs between 3 and 5 million US
dollars," he says. "And if you find nothing, the money is gone."
Expensive
undertaking
Building a
geothermal power plant is an expensive undertaking. Its costs are estimated to
be two to three times more than that of a coal power facility, according to
Schneider.
 |
| Volcanic areas are ideal sites for geothermal energy plants |
In addition
to costs, Indonesia's excessive bureaucracy, tough regulations and strict
government price controls add to the challenges. So the country, concedes
Schneider, "has a bit of a problem at the moment."
Most of the
geothermal power plants in operation in Indonesia today are run by the
state-owned natural gas and oil company PT Pertamina.
But in a
move to tap into the country's vast geothermal reserves, the Indonesian
government has opened the doors to foreign investment and know-how.
German
money and know-how
Today,
Germany is one of the biggest supporters, together with Japan, Australia and
the US. The German government has earmarked 300 million euros in aid.
Although
Germany is not a "volcanic country," it has extensive geothermal
expertise, admits Professor Ernst Huenges from the German Research Center for
Geosciences in Potsdam.
"Currently
in Indonesia, only geothermal steam is used," he says. "In Germany,
by comparison, we're also able to utilize the energy from hot water" to
significantly increase power production "by as much as 60 gigawatts."
'Demanding
target'
Potential
business opportunities also exist for German companies, points out KfW's
Schneider. "Building power plants, with all the electronics and other
technical equipment involved, is certainly of interest to German
businesses," he says.
Merkel and
Yudhoyono have agreed to collaborate in increasing Indonesia's share of
renewable energies to 25 percent by 2015.
Schneider
calls the target "utopian." Merkel, on the other hand, prefers more
diplomatic language, referring to the agreement as a "demanding
target," which Germany can help Indonesia achieve.
Few will
disagree, however, that there is plenty of work to be done - and some risk
involved - if Indonesia wants to tap its vast reservoirs of geothermal energy
deep down.
Author: Monika Griebeler / jrb
Editor: Sarah Berning
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