Green Prosperity PPP Initiative

of MCA-Indonesia
Jakarta, 28 November 2017
 Indonesia’s Renewable Energy Potential

Hydro Solar
75 GW 4,17 – 4,8
kwh/m2.hr Geothermal
29,164 GW

Wind
3 – 6 m/s Biomass Biofuel Ocean Energy
49.810 GW 32 GW 60 GW

Sumber: Ditjen EBTKE, 2014

Indonesia’s Policy on “Energy Mix” in
Electrical Power Generation
 Developing Viable
Green Prosperity Transactions
Investment Analysis and Structuring

Review Screen and Market Sounding

Portfolio Select Restructure as PPP or
Alternative Investment
Model
- Renewable Energy
- Sustainable Forestry
Develop Financing
Plan For Transactions
For Viable Projects
and GOI legacy
strategy

Project Outputs
Master List of Master List of
Potential Projects Pilot Projects developed Pilot Projects developed Market Testing
Projects Ranked and • Project Profiles • Financing Briefs • Investor Presentations
Analysed Screened • Business “Case” • GOI strategy for • Donor Presentations
* 30-40 • 5-10 developed Sustainable Financing
Projects Projects
 Green Prosperity Project
• Millennium Challenge - Account Indonesia (MCA-Indonesia) is a trustee
established by Bappenas to manage the Compact Grant, which supports
strategic partnership between United States of America and Indonesia.
MCA-Indonesia’s program is designed and implemented by the
Government of Indonesia.

• MCA-Indonesia aims to reduce poverty through economic growth through

three projects: Green Prosperity, Community-based Health and Nutrition
to Reduce Stunting, and Procurement Modernization.

• In line with GoI’s commitment, the Green Prosperity Project strive to

encourage environmental conservation and low carbon economic growth.
 Background of GP PPP Initiative

• Retained to review and prioritize MCA-Indonesia’s most

attractive renewable energy projects for private investors and
donors
• Reviewed 34 projects assembled by the Green Prosperity
Project Team
• Engaged to achieve overall goal of project to develop a
screening and ranking protocol to present highly ranked
projects to qualified investors
 Purpose of Screening & Ranking
• Evaluate MCA-Indonesia projects which have most potential
for development by private sector and/or donors
– Highest rate of return to investor with lowest risk
– Project can be implemented quickly
– Project fits into donor goal or strategy
• Then develop screening criteria that looks at the projects the
way an investor would, i.e., commercially attractive,
predictable revenues, potentially scalable, etc
• Rank those projects in order of most attractive to least
attractive to investors
 Preliminary Screening Criteria
Five (5) Primary Criteria (with sub-criteria)

1. Status with PLN

– Existence of Power Purchase Agreement (PPA)
– Indicative tariff: 6.68->14.89 US cents / Kw-hr

2. Project Site & Regulatory Status

– Land acquired or pledged
– Permits and licenses acquired
– Application for permits and licenses- but not yet received
 Preliminary Screening Criteria 2

3. Project Characteristics
– Detailed Feasibility Study (DFS)
• Prepared but not approved
• Approved
– Front End Engineering Design (FEED)
• Prepared but not approved
• Approved
– Detailed Engineering Design (DED)
• Prepared but not approved
• Approved
– Potential for project expansion
 Impact of Project Development

Investor
Confidence
in Cost
Estimates

Submitted Approved Submitted Approved Submitted Approved

DFS FEED DED
 Preliminary Screening Criteria 3
4. Project Type
– Community vs. Commercial
– Biomass/biogas
• Committed supply of biomass?
– Hydro/Solar

5. Donor Interest and Leverage Potential

– Interest and funding in particular type of RE project
– Interest in a particular area (geographical) or social impact
Results of Screening/Ranking Process

• Screen the projects into categories of:

a) viable
b) non-viable, using selected screening criteria
• Rank and select the most viable project(s) or ”cluster" of
projects
• Develop options for restructuring viable projects
• Develop the Action Plan for advancing the PPP and other
transaction models for viable projects
Commercial Renewable Energy Projects
Community Renewable Energy Projects
 Objective of Investors’ Forum

• Objective
– Facilitate dialog and information-sharing between the GOI,
MCA Indonesia, and select potential private sector
investors that may have interest in the Green Prosperity
portfolio of project opportunities
– Build interest in investment and assist in
promoting/moving projects along the successful
transaction phase
– Use informal and formal dialog process to market the
portfolio/projects pipeline to qualified investors
 Questions?

Feedback and Discussion