The Ministry of Energy and Mineral Resources (ESDM) will accommodate hybrid power plant tariffs in the draft Ministerial Regulation on the Principles of Renewable Energy Power Plant Electricity Purchase Agreements (PJBL). The formulation of ministerial-level regulations is a follow-up to the issuance of Presidential Regulation No. 112/2022 on Accelerating the Development of Renewable Energy for Electricity Supply in mid-2022.

"So the price study for 2024 is more about incorporating hybrid generator tariffs," Director of Various New and Renewable Energies at the Directorate General of New and Renewable Energy (EBTKE), ESDM, Andriah Feby Misna, said in Jakarta on Tuesday, February 27, 2024.

Feby said further that regulations on hybrid generators are also aimed at assisting investment in the current program of converting diesel power plants (PLTD) to be based on renewable energy.

She gave examples of several hybrid power plant schemes, such as the possibility of combining solar power plants (PLTS) with PLTD or biomass blending or co-firing.

"Studies and discussions with (State electrcity company) PT PLN and technical expert teams are underway to determine the appropriate tariffs," she said. This combination has recently become a solution amid the stagnation of investments in the dedieselization program of PT PLN.

The combined tariff is considered capable of attracting investors to join the fossil fuel-based power plant conversion program, which is currently mainly distributed in remote areas. As previously reported, PLN is currently auctioning dedieselization projects for oil-based power plants (BBM). PLN President Director Darmawan Prasodjo said phase 1 of dedieselization program auction will target 94 locations that will be divided into two clusters, the western and eastern regions of Indonesia.

"We have designed and are currently auctioning, namely our diesel power plants that still use BBM; we will replace them with new and renewable energy (EBT)-based power plants that can operate as 24-hour base load," Darmawan during a hearing with the Energy Transition Task Force of Commission VI at the House of Representatives (DPR) last October. According to Darmawan, the PLTD included in this program will be replaced by solar panels with a potential of 200 megawatts (MW). Additionally, there is the potential for additional investment in battery energy storage systems (BESS) of 350 MWh in the initial phase.

Furthermore, the potential for additional development for phases two and three reaches 800 MWp of solar panels. The management rights are granted for 20 years from the commercial operation date or COD.

"And for cluster 1, there are 48 locations, cluster 2 has 46 locations with a total of 200 MW, there is a BESS of 350 MWh," he said. In total, there are approximately 5,200 PLTD units with a capacity of 2.37 gigawatts (GW) in 2,130 locations that will be transferred through this dedieselization program.

The dedieselization program for these power plants will be carried out through three schemes: First, the conversion of PLTD into EBT power plants with a capacity of 500 MW. Second, the conversion of diesel power plants to gas (gasification) with a capacity of 598 MW, and third, expanding the network to isolated systems to eliminate diesel power plants with a capacity of 1,070 MW. Meanwhile, the remaining PLTD with a capacity of 203 MW will still be used as a black-start system during power outages.

In addition to meeting the EBT blend target, the dedieselization initiative is also expected to simultaneously reduce PLN's operational burden, which has widened due to the increase in global crude oil prices. As previously stated by the state electricity company, every US$1 increase per barrel of global crude oil prices will result in a US$500 increase in power plant operational costs.