Heavy equipment company PT United Tractors (UT) Tbk plans to expand its businesses by developing renewable energy resources.
The company, a subsidiary of diversified conglomerate PT Astra International Tbk, currently operates a 0.5 MW (megaWatts) Kalipelus mini-hydropower plant in Central Java and builds a 7 MW Besai Kemu mini-hydropower plant in Lampung.
United Tractors Corporate Secretary, Sarah K. Loebis, said the company had set targets to develop renewable energy facilities such as mini-hydropower plants, geothermal power plant, wind power plant, floating solar PV and waste-to-energy facility.
“We are conducting a study and review to develop renewable energy alternatives,” she told Indonesia Business Post on June 9, 2022.
Loebis said the development of renewable energy is a part of the company’s plans to expand into sustainable sectors and support Indonesian efforts in decarbonization.
“It should start operating in early 2023,” she said, referring to the mini-hydropower plant in Lampung. There are also several prospects for a mini-hydropower plant with a capacity of up to 20 MW.
There has been no further details on investment value, technology, or location of the projects, nor on partners collaborating with the company on the renewable energy project. For the time being, United Tractor will utilize its internal cash depending on the project’s size.
“It is unknown how much capital will be required for this renewable project. It will depend on what we decide later,” Loebis said. She added that there was no percentage target set for the renewable energy business.
The company, however, is open to foreign companies and vendors providing technology and equipment for these renewable energy projects.
Better known for its business in heavy equipment, coal and gold mining and construction equipment, United Tractors will invest US$750 million in capital expenditures in 2022. All the Capex will be used for operations, including purchasing heavy equipment for the mining contracting business, exploring its mines and repairing and extending facilities.
“The capital expenditures do not include investments in business development,” Loebis said.
United Tractors has planned to buy back shares from July 13, 2022, to October 12, 2022. The company will make a buyback of no more than 20% and at least 7.5% of the outstanding shares of the paid-in capital. The cost of repurchasing shares will use internal cash, which is planned at a maximum of IDR5 trillion, local media reported.
