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Draft Final Report

PROMOTION OF RENEWABLE ENERGY, ENERGYEFFICIENCYANDGREENHOUSEGASABATEMENT(PREGA)

Indonesia

Energy Demand Side Management

to Improve KLP Sinar RinjanisSustainability

A Pre-Feasibility Study Report1

October 2005

1 Prepared by the National Technical Experts from P.T. Chazaro Gerbang Internasional.


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Table of Contents

List of Tables............................................................................................................................iv

List of Figures ..........................................................................................................................iv

1. EXECUTIVE SUMMARY...............................................................................................1-1

2. MAP OF THE PROJECT...............................................................................................2-1

3. INTRODUCTION...........................................................................................................3-1

4. BACKGROUND.............................................................................................................4-2

4.1. Sector Description.................................................................................................4-2

4.2. Constraints and Issues Related to the Project Sector...........................................4-3

4.3. Sustainable Development Objectives....................................................................4-4

4.4. Government Policy and Strategy Relevant to the Project Sector..........................4-4

4.5. Overlap of the Governments and ADBs Policies and Strategies in This Sector..4-64.6. Benefits of the Project ........................................................................................... 4-6

5. GENERAL DESCRIPTION OF THE PROPOSED PROJECT ...................................... 5-7

5.1. About the Project...................................................................................................5-7

5.2. Project Goal...........................................................................................................5-7

5.3. Project Objective ................................................................................................... 5-7

5.4. Poverty Reduction.................................................................................................5-7

5.5. Technology Transfer ............................................................................................. 5-8

5.6. Project Partners.....................................................................................................5-8

5.7. Product or Service Generated by the Project........................................................5-8

6. PROJECT IMPLEMENTATION PLAN .......................................................................... 6-1

6.1. Time of Use Tariff Discussion ...............................................................................6-1

6.2. Target Group Identification....................................................................................6-1

6.3. Distribution of Energy Efficient Appliances and dual tariff meters.........................6-2

6.4. Monitoring of Energy Consumption Pattern .......................................................... 6-2

6.5. Summarised Implementation Plan ........................................................................ 6-2

7. CONTRIBUTION TO SUSTAINABLE DEVELOPMENT ............................................... 7-1

7.1. Long-term GHG and Local Pollutants Reduction .................................................. 7-1

7.2. Other Benefits .......................................................................................................7-1

8. PROJECT BASELINE AND GHG ABATEMENT CALCULATION ................................ 8-1

8.1. Current Production and Delivery Patterns.............................................................8-1

8.2. Project Boundary and Monitoring Domain.............................................................8-3

8.3. Baseline Methodology and Calculation of the Baseline Emission.........................8-4

8.4. Calculation of Total Project GHG Emissions.........................................................8-4


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8.5. GHG Emission Avoidance Monitoring and Verification ......................................... 8-5

9. FINANCIAL ANALYSIS OF THE PROJECT ................................................................. 9-1

9.1. Estimation of Overall Cost.....................................................................................9-1

9.2. Project Financial Analyses ....................................................................................9-1

9.3. Financing Plan.......................................................................................................9-1

10. ECONOMIC ANALYSIS OF THE PROJECT .............................................................. 10-1

10.1.Project Economic Analysis..................................................................................10-1

10.2.Poverty Reduction Impact ...................................................................................10-1

10.3.Social and Employment Opportunities ................................................................ 10-1

10.4.Environment Impact ............................................................................................ 10-1

10.5.Regional Development........................................................................................10-1

11. STAKEHOLDERS COMMENTS.................................................................................11-2

11.1.Invitation letters to the Stakeholders ................................................................... 11-2

11.2.Comments on the Project by above stakeholders...............................................11-212. KEY FACTORS IMPACTING PROJECT AND BASELINE EMISSION.......................12-1

12.1.Key Factors .........................................................................................................12-1

12.2.Project Uncertainties ........................................................................................... 12-1

13. CONCLUTION AND RECOMMENDATION ................................................................ 13-2

Annexes........................................................................................................................Annex-1

Annex 1. Electricity Tariff of KLP Sinar Rinjani.....................................................Annex-1

Annex 2. Daily Load .............................................................................................Annex-2

Annex 3. Pre-FS Survey Result............................................................................Annex-5

Annex 4. Percentage of lighting and other load for domestic .............................Annex-10

Annex 5. Load Simulation...................................................................................Annex-11

Annex 6. Financial and Economic Feasibility Calculation...................................Annex-14

Annex 7. Estimation of Overall Cost...................................................................Annex-16

Annex 8. Financial Analysis................................................................................Annex-17

Annex 9. Economic Analysis ..............................................................................Annex-18


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1. EXECUTIVE SUMMARY

Project Rationale

Koperasi Listrik Perdesaan (KLP) Sinar Rinjani is one of the three KLPs in Indonesia. It isnow the only one that is still operating in KLP scheme. The other two KLP Sawa Bintuna in

South Sulawesi and KLP Sinar Siwo Mego in Lampung are not operating anymore. KLPSawa Bintuna does not exist anymore. KLP Sinar Siwo Mego has been taken over byPT.PLN (Persero) although recent info showed that KLP Sinar Siwo Mego would bemanaged in KLP scheme once again. KLP Sinar Rinjani suffers from bad financial conditiondue to high diesel fuel consumption. High diesel fuel consumption is influenced by high-energy demand and high power loss (technical and non-technical). Increase of diesel fuelprice created severe financial problem to KLP. Adjusting the tariff to accommodate the fuelprice increase is hardly possible due to limited ability to pay of the customers. The conditionfurther decreases the service reliability.

Modifying (i.e. decreasing) the demand will improve service reliability and eventually improvefinancial condition of KLP Sinar Rinjani. The benefit is not just that. The project will alsoimprove environmental performance of KLP Sinar Rinjani by decreasing the emission level,

especially green house gasses.

The steadily increasing commercial energy price in Indonesia further increases the need ofdemand side management programme, especially at KLP Sinar Rinjani

Objective

Objective of the Energy Demand Side Management at KLP Sinar Rinjani is to demonstratethe technical viability of DSM programme in Indonesia and at the same time to prove theeconomic feasibility that such an approach can be implemented under the current trend ofincreasing energy price.

Output of the Project

The project will be able to save energy production up to 4.906.330 kWh per year. Thenumber equals to 1.486 kilo litres of diesel fuel. This means KLP Sinar Rinjani can save IDR3.269.233.906 annually. The number is very significant considering the current financialcondition of KLP Sinar Rinjani. Annual financial deficit of KLP Sinar Rinjani in 2003 reachedmore than IDR 1.800.000.000.

The avoided energy production equals to 1.471 tons of CO2 that can generate CDM CERrevenue of USD 7.359 per year.

Benefit of the Project

Basically the project will improve service reliability of KLP Sinar Rinjani. Beside that, the

project will also be able to improve the welfare of the community based on income spendingshift.

Environmentally the project will decrease gaseous pollutant emission from power generationactivity and reduce further global warming. Improvement in the service reliability has alsopositive effect for the industry sector (small household industry and agricultural industry).The industries can rely on the service of KLP Sinar Rinjani. Time of use tariff has to beproven to be the right strategy to attract industries to use more electricity. The operation areaof KLP Sinar Rinjani is an agricultural area. Therefore industry will be related to agriculture.


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2. MAP OF THE PROJECT

Figure 2.1. Map of the project study


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3. INTRODUCTION

The establishment of Rural Electricity Cooperative was one of much government efforts tomake cooperative as one of the economic pillars. Not just practicing saving-loan services,cooperative are also allowed to do electricity business especially in rural areas. It was the

Rural Electrification Programme (9 October 1979) who eventually gave birth to KoperasiListrik Perdesaan Sinar Rinjani (Rural Electricity Cooperative Sinar Rinjani, KLP SR). KLPSR is one of the first 3 KLPs in Indonesia. KLP SR is situated in Lombok Island, West NusaTenggara province, Lombok Timur district. The power plant is located at the KLP SRheadquarters, which is situated in Aikmel sub-district.

The historical moments of KLP SRs birth was started with a Feasibility Study that wascarried out by National Rural Electric Cooperative Administration (NRECA) of United Statesof America (USA) and Indonesian partners in the early 1980. The team studied the feasibilityof electric distribution in rural areas outside Java Island.

Directorate General of Cooperative and United States Agency for InternationalDevelopments (USAID) carried out the coordination actions with local government and also

PLN to determine the areas where such a cooperative based rural electricity plant would betechnically viable, financially and economically feasible and socially sound. The feasibilitystudy report was finished in August 1977 and reported that rural electric service area inLombok Timur District would cover 32 villages in Aikmel sub-district, Pringgabaya sub-district, Sukamulia sub-district, Masbagik sub-district, Terara sub-district, and Selong sub-district. Up to now KLP SR is serving more or less 37 villages in 9 sub-districts. The studyconcluded that the power plant should consist of 5 diesel-generating sets with total capacityof 500 kW. There are hydro resources in the service area of KLP Sinar Rinjani, but as thediesel fuel price was very low at that time mini hydropower was far less feasible than dieselgenerators. Recent utilization of hydropower showed that the generated capacity is verysmall compared to the power demand.

Since its establishment, KLP SR has faced many problems. One of the serious problems is

power loss. The voltage drop in the villages not far from power plant showed that technicalloss rate could reach 20%. Non-technical loss rate can reach more than 10%. There is nodetail investigation that separates technical and non-technical loss. The increasing number ofconsumers and limited improvement of network infrastructure creates huge technical powerloss (See Figure 8.1.). It is often seen that the wires turn burning red when the load is veryhigh. KLP SR is now practicing load shedding. Power loss means KLP SR has to burn morediesel fuel to supply the electricity demand. Network infrastructure of KLP SR is already oldnow.The aim of the project is basically to increase the service level of KLP SR so that the powerloss is lower and KLP SR will suffer a reduced financial loss. The project will also affect thefuel consumption, as lower fuel will be consumed, thus reducing the current level of GHGemission.

The study was prepared based on data statistical data collected in 2003. The statistical dataincludes:

1. Number of consumers2. Type of lamps mostly used by consumers3. Daily load of the power plant and4. Financial condition of KLP SR.


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Some background information of KLP SR is also collected such as reports and annualstatistics.

4. BACKGROUND

4.1. Sector Description

In Indonesia there are 66,215 villages. Out of 66,215 villages, there are 52,000 villagesalready electrified (DGEEU, 2003). Out of 52,000 villages, 28,595 villages are in outerislands and the rests are in Java Island. The increase of electrified villages is very significantbecause in December 2000 total village electrified is just 49,155 villages (www.djlpe.go.id,9/8/04). Most of the newly electrified villages are in outer islands.

The quality of service in each area is also different. In the rural areas, which have gridextension, the communities might possible to have 24 hours service. Areas that havedecentralised system (small diesel generator or solar home system) in most cases only haveelectricity service in the peak hours (6 pm. to 12 pm.). In the case of small diesel generators,

transport of fuel increases the price of diesel fuel cost therefore service time is often limited.The rural electricity supply strategy for each village might be different. Some villages areelectrified by PLNs extended grid and some villages are electrified by PLN decentralisedstandalone mini grids. The archipelagic nature of Indonesia has forced the government touse two different strategies for rural electrification. The first is extending the grid and thesecond is providing decentralised power system such as Solar Home System (SHS) ormicro-hydropower plants (MHP).

In the case where PLN could not reach the area KLP plays important role. Koperasi ListrikPerdesaan (Rural Electricity Cooperative, KLP) is the type of cooperative, which haselectricity as the main business. The involvement of cooperative was always consideringlocal condition such as capability to manage the resource. Based on those considerationsthe cooperation between PLN and cooperative in rural electrification can be categorised in

several Polas. Those Polas are: (Pola means pattern or type).

Pola 1. The cooperative does meter reading, billing, network maintenance, and minorrepairing at customer installationPola 2. The cooperative does all the Pola 1 cooperatives do plus house wiring installationand low voltage distribution network constructionPola 3. The cooperative buys electricity from the mid voltage network of PLN or other privategenerators and sells the electricity to the customersPola 4. The cooperative does electricity business vertically from generation, transmission,distribution, house wiring installation, maintenance, billing etc.

KLP Sinar Rinjani (KLP SR) in West Nusa Tenggara province is one of the 3 KLP models inIndonesia. The other 2 are KLP Sinar Siwomego in the province of Lampung, and KLP SamaBotuna in the province of South Sulawesi. KLP SR implements Pola 4 for its electricitybusiness. Pola 3 might be the right option for KLP Sinar Rinjani now but the limitation ofPT.PLN (Persero) prevents this from materialized. Right now the other 2 KLPs are alreadynot functioning because of many problems they faced. KLP Sawa Bontuna is not operatinganymore. KLP Sinar Siwomego was taken over by PT.PLN (Persero) but now KLP will takeback the management. The debt of KLP Sinar Siwomego reached IDR 23.000.000 andGovernment of Lampung will pay the debt to PT.PLN (Persero).


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The government intends to convert the electricity sector from centralised system to a morecompetitive system. Law 20 in year 2002 was intended to regulate the new system, but theConstitutional Court annulled it. It is argued that the law is not in line with the 1945Constitution. Right now the government is working on a new Electricity Law draft. Most of thecontent represents the annulled Law 20 year 2002 minus the competition part.In the draft law, rural electrification is the responsibility of government (central/local) with afull support of private involvement. The utilisation of renewable energy sources is fullysupported by the government and also by PLN. PLN itself has the target to increase theportion of renewable up to 5% by 2007 (PLN, 2005).

4.2. Constraints and Issues Related to the Project Sector

Commercial energy price is relatively very cheap in Indonesia. This condition has madepeople tend to use energy not efficiently. Such condition leads to high un-productive energydemand. The government has finally realised the mistake and now starts reducing theenergy subsidy. This should encourage people to use energy more efficient in long term.

Indonesian engineers basically already master energy efficient technologies. For long time

the demand for such technology is low (due to low energy price) so that Indonesia has onlylimited capacity to produce energy efficient technologies. Big CFL producers in Indonesia arestill importing CFL and not selling the locally produced CFL in Indonesia. This policy hasmade price for energy efficient technologies high thus even discouraging people to use it.Low energy price is responsible for the low demand for energy efficient technologies.

Focusing on energy efficient lamps, there are now many low quality imports. There are manyCFL with low quality thus has lower price sold in Indonesia. Although Indonesia has NationalStandard for CFL but those imported CFLs mostly do not comply with the standard. Despitetheir low quality, those CFLs sell very well because people needs efficient yet cheap lamp.Peoples choice is not always the right one. Their decision to buy cheap CFL has createdtroubles for themselves and for utility. Due to high power loss in many systems in Indonesia,the voltage stability cannot be maintained so that those cheap CFLs can easily break. This

condition is only valid for brandless CFL. Top CFL brands stand the voltage fluctuation verywell. This condition has created certain perception in most of the people. People think thatCFL are easily broken or unreliable so that they do not buy CFL anymore and keep relyingon incandescent lamps that are not energy efficient.

Condition above is not valid for higher quality CFL. The high quality CFL usually has widevoltage range so that it can handle voltage drop easily. The problem with that high qualityCFL is their price. It is not affordable for common people especially in rural areas inIndonesia.

Indonesia through the ministry of energy and mineral resources has launched DSMprogrammes targeted to household consumers, commercial/industrial consumers and alsostreet lighting customers. Perusahaan Listrik Negara (PLN, State Electricity Company) and

Directorate General of Electricity and Energy Utilisation (DGEEU) are the main players of theprogramme.

The programmes are actually widely disseminated but only made little impact. The DSMprogramme for household customers can only claim 295,000 CFL selling by December 2002(DGEEU). Compared to the number of PLNs customer the number of CFL sold is small. Forthe street lighting programme by end of 2002 there are only 3 cities joined with total 15,000lamps converted. The recent development for the industrial/commercial sector is that onlyaround 11industries/commercial building joining the programme and the number is


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decreasing. It seems the genuine commitment from the government/PLN is not there yet toimprove national energy efficiency.

4.3. Sustainable Development Objectives

KLP Sinar Rinjani is now burning diesel fuel to generate power. KP SR is intended to exploitthe micro hydro sites around its premises; however it requires more investment costs andtime for the implementation. Therefore, as a parallel approach KLP-SR intends to implementthe demand side management (DSM) measures. High power loss means KLP SR is burningfuel more than it should burn. This means more pollutants are released to the air. If the DSMprogramme were successfully implemented then the power loss should be lower than todayand less power should be generated. Less power to generate means less pollutant will bereleased. This means the project should be able to reduce local pollutants.

Another immediate impact of the project is reduction of fuel consumption. Due to less powerto be generated then the demand for fuel is also less. This will affect the financial condition ofKLP SR. Since the diesel oil price is steadily increasing (because of subsidy reduction andcrude oil price increase), the fuel expenses are the biggest cost component of KLP SR and

the source of financial loss. In order to maintain KLP SR existence, KLP SR carries asaving/loan programme for its member. Saving/loan programme proves to be very useful inrural areas and clearly gives positive impact to socio-economic condition of many ruralhouseholds. The proposed DSM project should be able to show reduction of fuelconsumption and improvement of financial condition of KLP SR.

Fossil energy source, especially oil, is now depleting. Energy has become a scarce resourcein Indonesia. Oil reserve in Indonesia might last less than 10 years with current consumptionpatterns (status 2000). This basically will force the people to use energy more efficiently orthe future generation cannot have the same living quality as todays generation. One way tocreate inter-generational equity is by improving the way we use energy today. Using energymore efficiently should be able to provide future generation with enough energy sources.Inter generation equality is another objective of the project.

For the people who consume the electricity produced by KLP SR, the use of energy efficientlamps will reduce a part of their expenses. This enables them to spend their money in thingsthat are more important such as health or food or education. The use of energy efficient lampalso gives them better lighting quality, which will satisfy their lowest expectation or evenbetter. Children can study better at night. The people via various media can absorb moreinformation. This means the project should be able to demonstrate improvement of livingquality.

4.4. Government Policy and Strategy Relevant to the Project Sector

Energy conservation programme is one of the oldest energy policies in Indonesia.Presidential Instruction No.8 of 1982 about Energy Conservation guides the implementation

of rational energy use without reducing the level of service. Basically energy policies inIndonesia are: intensification, diversification, and conservation (energy efficiency). Recentcondition of energy crisis has made the energy conservation gaining popularity and thegovernment has made the legal level of the regulation higher to Presidential Decree.Presidential Decree No.43 of 1991 regulates efficient use of energy and national energyefficiency programme. Most recently there was Presidents Instruction No.10 of 2005concerning energy efficiency programme.


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There are various strategies in improving energy efficiency in different sectors. In theindustrial and commercial sector the government launched a partnership programme. Theprogramme will give the partner industry/commercial building a free energy audit. Energyaudit is the first step of implementing energy efficiency measures. Right now the governmentis focusing on energy intensive industries such as steel industry, pulp and paper and alsotextile.

For other sectors the government has also launched DSM Programmes. Those DSMprogrammes are:

1. Terang Programme; changing 40 watts incandescent with 8 watts CFL to reducepeak load and electricity bill. Target group is a PLNs customer with connection of 900VA. This programme is already terminated because the government considers the900 VA customers already have the ability to buy CFL

2. Peduli Programme; changing 40 watts incandescent with 8 watts CFL to reduce peakload and electricity bill. PLN gives subsidy to the participants of this programme.Target group is PLNs customers that have 450 VA connection

3. Penerangan Jalan Umum Programme (Street Lighting Programme); Target group of

this programme is Local Governments. The aim of this programme is to reducingpeak load and also financial deficit of local government. Status in 2003 there are 3cities participating: Semarang, Medan and Jogjakarta.

To produce maximum result of energy efficiency, the government already has set standardsfor energy efficient appliances such as refrigerator, air conditioner, motors, and especiallylamps (CFL). Locally produced electronic equipment such as refrigerators or air conditionerusually already comply with the standard, but for CFL many cheap imported CFLs do notcomply with the standard (more or less 44% of 100 brands in the market, www.kompas.com,4 December 2003). Indonesian National Standard (SNI) for CFL lamps is SNI-04-6504-2001.The government has recently launched a labelling programme for energy efficienttechnologies. The label shows how green a product is.

Figure 4.1. Green Energy Label launched by the Government


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4.5. Overlap of the Governments and ADBs Policies and Strategies in This Sector

ADBs energy policy 2000s operational priorities among others are promoting the use ofrenewable energy, demand side management, and energy efficiency. The statement aboveshows that ADB has commitment to improve environment condition by implementing somestrategies and that some of them are explicitly demand side management and energyefficiency.

The energy policy of the Government of Indonesia also supports the implementation ofdemand side management and energy efficiency. Energy efficiency is one of the oldestenergy policies in Indonesia. The government with the involvement of all related stakeholdersrecently has implemented the above-mentioned strategies. Programmes such as GreenEnergy Labelling and Terang Programme/Peduli Programme shows the commitment of GOI.

It is clear that there is positive overlap of the GOIs and ADBs policies in the sector.

4.6. Benefits of the Project

The community can use energy more efficient so that it enables them to save money forother purposes such as health and education. Using CFL lamps people can get betterlighting quality at lower wattage and this means lower electricity bill. This means the peoplecan allocate the saved money for other useful activities. West Nusa Tenggara is one of theleast developed areas in Indonesia in the health sector. People can spend their money forbetter water supply or better food. This is the benefit of peak clipping concept.

Using the benefit of lower daylight tariff, businessmen can start businesses that useelectricity as the production input. As the electricity tariff is lower in daylight, the productioncost will be lower and they can sell their products at more competitive price. This is thebenefit of valley filling concept.

For KLP SR, the programme will bring some benefits. Most important benefit is the morebalance operation of diesel generator sets that will affect the fuel consumption. At the endmore efficient fuel consumption will make financial condition of KLP SR better. Balanceoperation is possible if the daylight and night load were at the same or almost the same level.It might be very difficult to level night load and day load; therefore KLP can reach efficientfuel use by applying right diesel generator combination during daytime and night.

Peak load can never be avoided but with DSM programme at least the peak load can bereduced to a level that is closer to the base load (peak cutting). DSM programme should alsobe able to give incentive for more (productive) daytime electricity use so that the base loadcan be increased closer to the peak load (valley filling).

Less peak load can reduce the power loss so that KLP SR can increase the service level.

Increasing service level means KLP SR can satisfy more customers and the customers willbe more loyal to KLP SR. More loyal means the rate of unpaid electricity bills is lower thanwhen the services of KLP SR were not good.

Less power loss means the energy produced will be used more efficiently. This decreasesfossil fuel waste. The power consumption in total might increase, depending on the tariffincentive, but if not then total power consumption in a day should be lower than before. Thismeans less fuel is burnt therefore less pollutant is released.


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Tariff incentive in daytime might increase the use of electric power for productive uses suchas for small household industry and rice milling (which are mostly operating with dieselfuelled engines). This will eventually help the people to improve their economic activity andimprove the regional economy. More jobs opening might be available in the future becauseof the emerging small industries. The possibility of schools to use interactive educationaltools will also improve manpower skill and provide skilful manpower in the future that mighthelp to improve the economy in the area.

5. GENERAL DESCRIPTION OF THE PROPOSED PROJECT

5.1. About the Project

Project TitleEnergy Demand Side Management to Improve KLP Sinar Rinjanis Sustainability

Location

Sub District: Aikmel and the service area of KLP Sinar RinjaniDistrict: East LombokProvince: West Nusa Tenggara Province

5.2. Project Goal

The goal of the project is increasing the awareness of domestic customers to utilise energymore efficient and improving economic activity through better energy utilisation. Other projectgoals are:

Improving the financial and technical sustainability of KLP Sinar Rinjani Reducing the peak load of KLP Sinar Rinjani

5.3. Project Objectives

The objectives of the project are: Installation of energy efficient lamps Installation of dual tariff kWh meter Setting up domestic time of use tariff system in KLP Sinar Rinjani Disseminating the success to other stakeholders in the country.

5.4. Poverty Reduction

The installation of efficient lamps and also dual tariff kWh meter is expected to influence theconsumption patterns of residential consumers. Efficient lamps should decrease monthly

electricity consumption so that the poor families will pay less. Dual tariff kWh meter will beable to decrease electricity consumption especially in peak hours. Less electricityconsumption means less payment.

There is likely to be some direct impact on poverty reduction from a shift on incomespending. For example, before DSM energy spending might reach 40% of total expensesand after DSM energy spending might be less than 40%. This means the people can spendmore on food for example. Implication of this is people can provide their most basic needsbetter due to DSM implementation.


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For poor people, energy in the form of primary energy is one of primary needs, but energy inthe form of secondary energy (e.g. light) might be secondary or even tertiary needs. Usuallypoor families have illegal connection from their richer neighbour. They have to pay certainamount of money for one lamp connection (less than 25 watts). They usually pay too muchfor such small connection. Such condition worsens the power loss due to bad installation andconnection. With the improvement of electricity service KLP Sinar Rinjani can give poorclass service with lower flat tariff. This condition will certainly improve the economy of poorfamilies and they can spend their money for more important needs.

Introduction of Time of Use Tariff is expected to improve the service reliability of KLP SinarRinjani and also provide incentive for small industries to operate in daylight. The growth ofsmall industries will eventually open up new employment opportunities. New employmentopportunities will surely reduce poverty in the area.

5.5. Technology Transfer

There is no specific technology transfer in this project unless the lamp producing companies

want to produce energy efficient lamps in Indonesia. Up to now there are only 2 producersthat manufacture and sell locally made CFL lamps in Indonesia namely PT.Sinar AngkasaRungkut (Chiyoda Brand) and PT.Matsushita Lighting Indonesia (National Brand). The rest ofthe producers (7 other producers) are importing CFLs and selling those CFL in Indonesia(http://www.djlpe.go.id/, 4 Dec 2003).

Dual tariff kWh meter is not yet produced in Indonesia, so the local meter producers shouldlearn the technology so that local products can replace the imported kWh meter.

5.6. Project Partners

DGEEU is the main partner in the project because it represents the Department of Energyand Mineral Resources that sets the energy efficiency policy in Indonesia. Department of

Cooperative as the umbrella institution for cooperatives in Indonesia should also be involvedespecially in supporting the financial management of KLP Sinar Rinjani.

KLP Sinar Rinjani is the main actor in this project. Energy Efficient Lamps producers shouldalso be involved in order to ensure that the project will get better quality assurance so thatthe project will be successful. Electric meter producers (kWh meter) should also be involvedespecially for the technology transfer purpose of the project.

PLN has the experience in implementing similar DSM programme could give advice to KLPSinar Rinjani so that the project will be successful.

5.7. Product or Service Generated by the Project

The project will install quality assured CFL lamps to target groups houses using certainfinancial mechanism and also installation of dual tariff kWh meter in selected families.


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6. PROJECT IMPLEMENTATION PLAN

6.1. Time of Use Tariff Discussion

This is the very important step because it might take long time to ensure the members of the

cooperative to approve the tariff system. Implementation of the system in the early stagemight be limited. Improvement of energy efficiency change of energy use habit should bedisseminated so that more members join the time of use tariff system.

The discussion might take long time because the procedure in KLP Sinar Rinjani needs thegeneral assembly of members to approve any kind of policies.

6.2. Target Group Identification

The target group will be identified based on the lighting technologies they used. A survey oflighting technology penetration has been done in 2003 and it is assumed that the result is stillvalid. Lamp technologies targeted are incandescent lamps and low efficiency fluorescentlamps.

All families in the service area of KLP SR are using incandescent lamps with variouswattages. The lowest is 2.5 watts and the highest is 100 watts. Target of replacement is all-incandescent except the 2.5 and 5 watts incandescent. More than half families in the areaare using fluorescent lamps that have wattage ranging from 10 to 20 watts. All fluorescentlamps are targets of replacement.

Here is the summary of lamp replacements.

Table 6.1. Lamp Replacement Plan

Replacement

Closest

Incandescent

Rating

5 watt CFL 25 watt

5 watt CFL 25 watt

5 watt CFL 25 watt

8 watt CFL 40 watt

14 watt CFL 60 watt

14 watt CFL 60 watt

18 watt CFL 100 watt

5 watt CFL 25 watt

5 watt CFL 25 watt

Fluorescent Lamps

10 watt

20 watt

40 watt

60 watt

75 watt

100 watt

Incandescent Lamps

10 watt

15 watt

25 watt

Number of lamp replacement is calculated statistically.

For the dual tariff kWh meter installation, the target group is selected based on theirconnection class. Out of 13.088 residential customers, there are 7.436 customers that have2.200 VA connections. These customers consume more or less 58% of total energy sales.Customer of 2.200 VA will be the first target of dual tariff kWh meter installation. For the firststage 3.000 customers of 2.200 VA will be selected based on their monthly energyconsumption. The one that consumes more has the chance to be chosen.


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6.3. Distribution of Energy Efficient Appliances and dual tariff meters

Cooperation with CFL producer will ensure supply of good quality CFL. After the targetgroups are identified then the CFL lamps are distributed. The distribution will use centralisticsystem i.e. a distribution task force from KLP Sinar Rinjani to ensure the CFLs are handed tothe right group.

Electricity meter (kWh meter) with dual tariff setting will be imported. Tariff setting will bediscussed by internal KLP SR system through member assembly mechanism. Tariff settingmight be the longest process because it involves many parties. There will be randomquestionnaire distributed.

Trained installer of KLP Sinar Rinjani will do Setting and installation of dual tariff kWh meter.

6.4. Monitoring of Energy Consumption Pattern

The installation of CFL and also implementation of dual tariff system will surely affect theconsumption pattern. It is expected that the consumption level will decrease. Experiences of

Durban Metro Electricity in South Africa showed that installation of dual tariff kWh meter andapplication of Time of Use Tariff successfully decrease the electricity consumption to 20%less (R.F.Wienand, R.C.Reuben; Domestic Time of Use Tariff: The Durban Experience,1999).

Monitoring can be done by examining electricity bills and the power production records.Monitoring will be done regularly

6.5. Summarised Implementation Plan

Table 6.2. Summary of Implementation Plan

Activities Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7-Month 12

Time of Use Tariff Discussion

Questionnaire Distribution

Identification of Targets

CFL Procurement

Dual Tariff kWh Meter Procurement

Distribution of CFL Lamps

Installation of Dual Tariff kWh Meters

Monitoring


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8-1

7. CONTRIBUTION TO SUSTAINABLE DEVELOPMENT

7.1. Long-term GHG and Local Pollutants Reduction

The current electricity supply system at KLP Sinar Rinjani is utilising several diesel

generators. Some of the peakers are already old thus consuming more fuel than theyshould be. The base loaders are relatively new generators so they consume fuel at normalfuel consumption range ( 0.3 litre/kWh).

The possibly lower energy consumption will affect the percentage of technical loss and alsonon-technical loss. The percentage of technical and non-technical loss should be lower. Thefinal impact will be lower energy production and this means lower CO2 emission and alsoother pollutants (NOx, SOx, particulate etc.).

Incentive to use electricity at daylight is expected to increase productive load (for thereliability also increases). Increasing daylight load will improve the daily load pattern thusalso improve the diesel generators operation pattern. The base loaders will work at theiroptimum point so it will consume fuel more efficient. More efficient fuel consumption will

decrease CO2 emission and also other air pollutants.

7.2. Other Benefits

The Time of Use tariff will provide incentives for productive usage in daylight. Small household industries or other medium industries (rice milling for example) are expected to grow.This will eventually improve the regional economy (in the area of KLP Sinar Rinjani) and alsoimprove financial condition of KLP.

The development of new productive activities will also improve the condition of job marketand indirectly reducing poverty in the area. Balance of operation of the diesel generators willaffect the fuel consumption. As the base load is expected to increase, the generatorsoperated as peaker can be shifted as base loader and operate at optimum point thus

improving fuel efficiency. Fuel efficiency is surely improving financial condition of KLP SinarRinjani.

The experience of KLP Sinar Rinjani in implementing Time of Use Tariff will be an importantexperience in the energy sector in Indonesia. Although PLN already implements IndustrialTime of Use Tariff, but the domestic tariff is still based on blocks of consumption. There islittle incentive to make efficient use of electricity. Implementation of Domestic Time of UseTariff will surely improve the load condition especially in Java-Bali system if adopted there.

8. PROJECT BASELINE AND GHG ABATEMENT CALCULATION

8.1. Current Production and Delivery PatternsCurrently KLP Sinar Rinjani has production capacity of 4.5 MW and peak load is 4 MW(implementing load shedding). Base load is more or less 1 MW. Power loss at KLP SinarRinjani is calculated as total energy production and deducted by paid energy, street lighting,and own use. Based on the latest data, the total power loss is more or less 25%. The loss isnot 100% technical loss because there are many electricity theft and also unpaid energy.Average energy production is reaching 46,000 kWh per day.


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8-2

The technical power loss can reach 20% considering the voltage drop in villages not far fromthe power plant. Voltage in the villages in the radius of 2 kilometres from power plant variesfrom 180 Volt to 200 Volt. Non-technical loss varies each time because it is closely related tounpaid bills. The highest recorded of technical and non-technical loss more than 50% in1990. Below is the graph of power loss development.

0%

10%

20%

30%

40%

50%

60%

1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Year

Losses(%)

0

5000

10000

15000

20000

25000

30000

35000

40000

NetworkLength(10m)andMembers

% losses Network Length Members

Figure 8.1. Power loss versus network length and number of customer


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8-3

8.2. Project Boundary and Monitoring Domain

Figure 8.2. Monitoring Domain

The boundary of the project is more or less the PLNs service area. This is because theproject implementation will involve as many customers of KLP as possible and this meansservice area of KLP Sinar Rinjani is the project domain. Service area of KLP is bordered byservice area of PLN and the sea.

Lombok Area is one of energy deficit areas in Indonesia (ASEAN Centre for Energy). One of

the deficit energy sectors is electricity. PT.PLN (Persero) Nusa Tenggara Barat is not able toprovide 24-hour service to all areas in Lombok. PT.PLN (Persero) Nusa Tenggara Baratrelies on diesel generators. Generating capacity from diesel generator is 147 MW. PT.PLN(Persero) Nusa Tenggara Barat operates at loss. Monthly financial deficit is more than IDR1.000.000.000.

Considering the limited generating capacity of PT.PLN (Persero), the option to buy powerfrom PT.PLN (Persero) is hard to happen. PT.PLN (Persero) is now receiving very smallsubsidy from the government. PT.PLN (Persero) has to survive financially. It is very hard forPT.PLN (Persero) to suffer more financial loss in Lombok. This condition also explains thereason why the second option is hard to be materialized. PT.PLN (Persero) has no intentionto take over KLP Sinar Rinjani.

It is the local government (provincial and district level) that supports KLP Sinar Rinjani. Localgovernment gives direct fuel subsidy to KLP Sinar Rinjani. Considering the options above,the proposed project boundary is still a valid option.

Monitoring domain consists of two main components: generator area and office area. Thegenerators will provide technical data such as fuel consumption and energy production.Energy production will be measured at the controller and before it is distributed to customers.


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8-4

Office area will provide accounting data that shows non-technical losses and relatedconsumption pattern of the customers.

8.3. Baseline Methodology and Calculation of the Baseline Emission

Baseline methodology used here is based on the small scale CDM project methodology forsmall hydropower. In this case the energy produced by small hydropower is the avoidedenergy production of diesel power plant. Total energy production is energy production at busbar before it is distributed to customers.

Total energy production is then multiplied with the appropriate emission factor for generatorsbigger than 200 kW (0,3 kg/kWh) to get baseline emission. Here is the summarisedcalculation of baseline emission.

Table 8.1. Summary of Baseline Emission Calculation

No Calculation Factor Unit Value

1 Daily Average Energy Production kWh 46.803,02 Emission Factor kg/kWh 0,3

3 Daily Baseline Emission kg/day 14.040,9

4 Annual Baseline Emission kg/year 5.124.928,5

8.4. Calculation of Total Project GHG Emissions

Calculation of total project GHG emission will be based on total energy production beforeDSM and total energy production after DSM. There is possibility of base load increase afterthe implementation of time of use tariff. The increase will be included in the after DSM load.The calculation in this study does not include base load increase because of lack ofinformation.

Avoided Energy Production = Energy Production before DSM- Energy Production after

DSM

Total project GHG emission is multiplication of total energy production after DSM andappropriate emission factor for generators bigger than 200 kW. Avoided CO2 emission is theresult of avoided energy production multiplied by emission factor. Below is the summary ofproject GHG emission and emission avoidance.


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8-5

Table 8.2. Summary of Possible Project GHG Emission and GHG Avoidance 2

No Calculation Items Value Unit

Daily Energy Production

Before DSM 46.803,0 kWh

After DSM 33.361,0 kWh

2 Avoided Produced Energy 13.442,0 kWh

3 Emission Factor 0,3 kg/kWh

4 Baseline Emission 14.040,9 kg

5 Project Emission 10.008,3 kg

6 Avoided Emission 4.032,6 kg

1.471.899,0 kg

1.471,9 tons

Annual Avoided CO2

Emission

7

1

Detail calculation and load simulation and method of load simulation can be found in theAnnexes.

8.5. GHG Emission Avoidance Monitoring and Verification

GHG emission avoidance monitoring can be done using two different sources: generator andadministration. The generator will provide produced energy in total. Up to now there is nometer to record energy production. The operator usually records the load regularly every 30minutes in peak times. In base load times the operator records the load hourly. Should therewill be energy meter, it should be installed before bus bar. The records from both the meterand the operator should be collected as cross check information.

Administration data such as consumption of fuel and recorded energy consumption (fromcustomers meter) will be used to verify the emission calculation. Below is the required datato monitor and verify GHG emission.

Table 8.3. Required data to monitor and verify GHG Emission

No Data Source Function

1 Load Records Operator Monitor Energy Production

2 Produced Energy Meter Monitor Energy Production

3 Fuel Consumption Administration Verify Information

4 kWh Reading Record Administration Verify Information

2Value is maximum possible GHG avoidance based only on lamp changing to CFL lamps


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9-1

9. FINANCIAL ANALYSIS OF THE PROJECT

9.1. Estimation of Overall Cost

Financial analysis is prepared to provide a clear picture about the profitability of the project.

The detailed technical and financial parameters are summarized in the Annexes of thereport. As presented, the total project cost (consisting of investment cost) is IDR1,800,000,000. It equals to USD 189,474 (for the exchange rate of USD 1 = IDR 9,500).Total annual OM cost is IDR 9,682,235,325 that consists of generation, networkmaintenance, billing and selling and administration costs. The number equals to USD1,019,183 (USD 1=IDR 9,500). From electricity sales, the project can generate annualincome IDR 10,228,482,600 (about USD 1,076,682) and CER annual revenue IDR69,915,203 (about USD 7,359).

9.2. Project Financial Analyses

The financial analysis on the Annex shows the value of FIRR and FNPV based on 12%discount factor. The FIRR with CER revenue is 20,03 % and FNPV with 12% discount factor

will be IDR 1.433 million and the FIRR without CER revenue is 18% and FNPV will be IDR967 million.

From the description above the value of FIRR is bigger than the discount factor at 12%. Thevalue of FNPV is also positive and this means that the project is financially feasible.

9.3. Financing Plan

Local Foreign Total %

IDR'000 IDR'000 IDR'000

FUND REQUIRED

Proposed Project

Capital Expenditure 753.000 2.259.000 3.012.000 23,73%

Operating Expenditure 9.682.239 - 9.682.239 76,27%

Financial charges during development - - - 0,00%

TOTAL PROJECT REQUIREMENT 10.435.239 2.259.000 12.694.239 100,00%

SOURCES OF FUNDS

Proposed ADB loan - 2.259.000 2.259.000 17,80%

Other loan - - -

Equity or capital contributions -

Government 600.000 600.000 4,73%

Internal Source 153.000 153.000 1,21%

Subsidies for operation - -

Internal cash generation 9.682.239 - 9.682.239 76,27%

TOTAL SOURCES 10.435.239 2.259.000 12.694.239 100,00%


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10. ECONOMIC ANALYSIS OF THE PROJECT

10.1. Project Economic Analysis

The detailed calculation is presented in the Annexes. The economic analysis shows that at

12% discount factor the EIRR with- and without CER revenues is 52,04% and 50%,respectively. While, the ENPV with- and without CER revenue at 12% discount factor isrespectively found IDR 7.097 million and IDR 6.747 million.

From the description above results, it can conclude that the DSM project is economicallyfeasible.

10.2. Poverty Reduction Impact

The project will benefit the community of Lombok Timur because they can use their moneyfor more urgent needs such as health, quality food etc. The shift of income spending willsurely improve living condition of people in Lombok Timur, especially because they havevery low human development index compared to other area in Indonesia (World Bank, 2002).

This basically will reduce poverty.

10.3. Social and Employment Opportunities

The work to replace old kWh meter with the new dual tariff kWh meter and installation of CFLlamps will need lots of manpower due to large number of KLP SRs customer. Skilledworkers from KLP Sinar Rinjani will do the installation and local non-skilled workers cansupport the installation. The installation team might consist of 1 skilled worker and 2 helpers.Two teams will have the responsibility to install kWh meter and CFL in one village.

There are at least 40 villages in the service area of KLP SR so at least there are 80installation teams with 80 skilled workers and 160 non-skilled workers. This is a quitesignificant number of jobs. Indirectly the temporary workers will improve the social condition

in the area.

10.4. Environment Impact

Avoiding burning diesel fuel will certainly improve the emission from the diesel generators.Less pollutant will be emitted. Pollutant such as CO2, NOx, SOx, Hydrocarbons and alsoparticulate will experience declining concentration in the ambient air. This condition willsurely improve local environment, especially air quality.

Less fuel used will affect the volume of fuel transport to KLP SR. This practice affects thepossibilities of fuel spill during transport and during loading and unloading. Less oil spill willdecrease the possibility of soil and shallow ground water contamination.Basically less fuel consumption will improve environment condition.

10.5. Regional Development

The programme intends to improve the service reliability of KLP Sinar Rinjani. Better servicereliability means KLP can produce enough energy and deliver high quality electric power.Higher reliability is an important decisive factor for commercial/industrial customer. If KLPwere able to produce reliable power then more commercial/industrial customer can beattracted.


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11-2

More industrial activities in the area will develop the region. It means there will be moreeconomic activities that eventually affect the economy of the region.

Reliable electric power can also improve the service of government institutions so that theycan work smoothly and faster. Better civil service is certainly improving development processin the area.

11. STAKEHOLDERS COMMENTS

11.1. Invitation letters to the Stakeholders

The related institutions and/or organizations have been contacted personally, by fax andletters, where the project was introduced and outlined including the explanation about therisks and benefits. Up to now still only KLP Sinar Rinjani that has been asked for theircomments or no objection regarding the technical, environmental and social issues.

The stakeholders identified for the project are as follows:

Directorate General for Electricity and Energy Utilization (DGEEU) Provincial Office of Cooperative Provincial Office of Mines and Energy District Government of East Lombok through the District Planning and

Development Board Koperasi Listrik Sinar Rinjani (Sinar Rinjani Rural Electricity Cooperative)

11.2. Comments on the Project by above stakeholders

Up to now, not all organisations have shown their comments on the project.Most important comments are coming from KLP SR. The management board of KLP SinarRinjani is basically in favour of such DSM Programme. The management has to do anythingto save KLP from bankruptcy and one of the strategies in the plan is DSM programme. Theysupport the idea and will have full commitment to carry out the programme. The one littleproblem is their financial position.

The provincial office of cooperative basically always supports any strategies that will improvethe sustainability of KLP Sinar Rinjani. KLP Sinar Rinjani is their pride because it is the onlyKLP (out of 3 pilot KLPs in Indonesia) that is still running and operating. It is the obligation ofthe office to support KLP SR in any ways.

DGEEU supports any kind of energy efficiency programme implementation. DGEEU asgovernments representative in power sector has all the interest to secure energy supply in

such sustainable way.


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12-1

12. KEY FACTORS IMPACTING PROJECT AND BASELINE EMISSIONS

12.1. Key Factors

Key factors impacting project emission are:

Willingness of the cooperative member to switch the current tariff structure to dualtariff structure. Dual tariff were set to encourage customers to use energy moreefficient. If there were no agreement then there is no encouraging factor. People willtend to use energy more rationally

Price of diesel fuel. Higher price will certainly reduce energy production due to currentfinancial condition of KLP SR. This has close relationship with KLPs financialcondition. Right now KLPs financial condition is not in good shape and limits thecapability of KLP SR to purchase diesel fuel. Less diesel fuel in the stock then lessenergy will be produced

Price of dual tariff kWh meter or production of local dual tariff kWh meter. Higher pricewill tend to affect the purchasing capability of KLP SR and further will affect thenumber of customers having dual tariff kWh meter installation

Electricity theft practice/ability of KLP SR to provide electricity for poor customers. Un-metered electricity usage will increase the volume of diesel fuel burned

Engine condition/maintenance of the engines. Bad engine condition, in term highSpecific Fuel Consumption (SFC), will certainly increase the volume of diesel fuelburned per kWh produced. Maintenance that is carried out regularly should be able tomaintain engine condition at its peak

Change of energy usage habit. There is possibility that at peak time people useenergy at the same level (regardless higher price) and significantly reduce the use atdaytime to compensate the financial aspect of energy consumption.

Key factors impacting baseline emission are: Price of diesel fuel. Higher price will certainly reduce energy production due to current

financial condition of KLP SR. This has close relationship with KLPs financialcondition. Right now KLPs financial condition is not in good shape and limits thecapability of KLP SR to purchase diesel fuel. Less diesel fuel in the stock then lessenergy will be produced

Engine condition/maintenance of the engines. Bad engine condition, in term highSpecific Fuel Consumption (SFC), will certainly increase the volume of diesel fuelburned per kWh produced. Maintenance that is carried out regularly should be able tomaintain engine condition at its peak

Load shedding implemented by KLP SR. Load shedding is implemented because thepeak load exceeds the generating capacity. Limited generating capacity is influencedby engine condition (most engines are already old)

12.2. Project Uncertainties

Natural disaster. Location of the power plant is right at the foot of Mount Rinjani thatis an active volcano. Possibility of eruption is high, therefore there is a chance thatthe power plant will be destroyed

Energy usage habit. People usually hard to change habits, especially energy usagehabit. Higher peak time price will surely force them to change energy usage habit.Changing habit might take long time and there is no guarantee of success. Peoplemight still use the same amount of energy despite higher price at peak time and samevolume of energy is still produced by KLP


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13-2

Financial condition of KLP and potential energy demand in East Lombok Regencyattract many investors. There is possibility of utility acquisition by private investor.Acquisition by private sector will be followed with the installation of more efficientpower plant such as coal fired plant and improvement of network. A China consortiumseeks the potential to install an 80 MW coal fired plant in Lombok. Recent updateshows that there are no further actions from the consortium.

13. CONCLUSION AND RECOMMENDATION

The study confirms that the Energy Demand Side Management Programme is technically,financially and economically viable. Furthermore, the discussions with the KLP Sinar Rinjaniand Provincial Office of Cooperative revealed interests and commitments to support theprogramme and improve the sustainability of KLP SR.

However, further investigation are needed such as undertake a more detailed feasibilitystudy to further verify the overall frame conditions of the project. A comprehensive survey ofthe energy demand and the characteristic of the customers must be carried out.

The detailed design of the project should provide an even more accurate cost estimation andfinancial and economic analysis.


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PREGA Phase 2 - ADB TA REG 5972

Annexes

Annex 1. Electricity Tariff of KLP Sinar Rinjani

Household R1/TR 450 9.000Rp 600Rp 625Rp 65Rp R1/TR 900 13.500Rp 600Rp 625Rp 65Rp R1/TR 1300 19.500Rp 600Rp 625Rp 65Rp R2/TR 2200 25.300Rp 600Rp 625Rp 65Rp R2/TR >2200 Rp. 20000/KVA

Industry I1/TR 0-200 KVA 27582/KVA 600I2/TR >200 KVA 24522/KVA 600

Commercial U1/TR 0-200 KVA 27582/KVA 600U2/TR >200 KVA 25488/KVA 600

Social S1/TR 450 7650 0-30=600 >30=650S1/TR 900 12600 0-20=600 21-60=625 >60=650S1/TR 1300 18200 0-20=600 21-60=625 >60=650S1/TR 2200 24200 0-20=600 21-60=625 >60=650

>2200 18500/KVA

Steet Lighting P3/TR 510

Blok I up to

20 kWh

Blok II 20-60

kWh

Blok III mo

than 60 kW

62Rp

Classes VA

Connection Fee


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Annex 2. Daily Load

wed thu fri sat sun mon tue wed thu01. Okt 02. Okt 03. Okt 04. Okt 05. Okt 06. Okt 07. Okt 08. Okt 09. Okt

1700 1107 1070 1123 776 1138 1118 1106 1230 10681730 1154 972 1313 1010 1355 1284 1213 1344 1215

1800 1504 1352 1544 1353 1515 1553 946 2064 13551830 1642 1776 1817 1697 1724 1955 1982 3253 3210

1900 3504 3733 3633 3575 3697 3852 3897 3681 38641930 3609 3822 3634 3646 3772 3937 3954 3712 3872

2000 3562 3777 3601 3605 3699 3948 3926 3749 39352030 3591 3847 3538 3508 3685 3820 3834 3695 3817

2100 3534 3370 3360 3343 3566 3639 3664 3594 36452130 3295 3389 3202 3609 3295 3590 3359 3485 3359

2200 3334 3205 3196 3443 3268 3414 3354 3457 34012230 3118 2899 2736 2899 2888 3048 2850 3094 2990

2300 2512 2352 2499 2404 2423 2508 2414 2558 25062330 2199 2151 2328 2250 2122 2250 2233 2256 2259

2400 2052 2017 2076 2110 1968 2100 2108 2084 21300100 1875 1925 1925 1910 1931 1942 1909 1499 1907

0200 1821 1842 1799 1855 1869 1841 1821 1850 18490300 1826 1818 1814 1831 1825 1847 1778 1834 1838

0400 1850 1834 1847 1847 1865 1853 1825 1843 18300430 1419 1942 1930 1937 1983 2000 2008 1957 2008

0500 2374 2471 2358 2420 2458 2622 2347 2393 24820530 2253 2707 3104 2918 2902 2894 2749 2818 2825

0600 2414 2558 2687 2628 2706 2516 2449 2500 22390630 1295 1834 1894 1851 1869 1873 1672 1717 1727

0700 1384 1500 1480 1627 1464 1448 1489 1428 1424

0800 1144 1224 1136 1288 1212 1256 1144 1212 12080900 1034 1212 1080 1267 1104 800 1142 1120 1152

1000 1104 1192 1064 1271 872 1418 0 2169 2721100 1128 1272 1120 1344 896 1465 256 1966 304

1200 1128 1256 768 1296 1264 1256 240 2109 3041300 992 1080 958 1200 1128 1064 256 1993 1120

1400 1088 1040 312 1168 1128 1064 240 2074 11601500 0 982 1010 1023 1106 1076 1072 1036 529

1600 1031 1005 1058 1051 1088 921 1050 1136 437

Hour


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mon tue wed thu fri sat sun mon tue wed thu fri13. Okt 14. Okt 15. Okt 16. Okt 17. Okt 18. Okt 19. Okt 20. Okt 21. Okt 22. Okt 23. Okt 24.1079 1097 1102 1160 1086 1114 1160 1179 1085 1

1565 1141 1223 1340 1167 1347 1276 1231 1237 1399 1224 1

2253 1291 1627 1779 1526 1617 1492 1482 1541 1595 1090 13636 3491 3303 3600 3760 2974 3391 3416 3476 3431 3311 3

3919 3913 3900 4024 3959 3770 3784 0 4005 3949 3949 33977 3878 4006 4057 4052 3798 3942 3339 4073 3680 4077 3

3930 4007 3951 3991 3988 3752 4038 3453 4079 3450 4028 3

3816 3774 3845 3947 3855 3640 3937 3669 3996 3359 3990 33582 3577 3663 3943 3694 3935 3668 3598 3913 3379 3791 3

3443 3575 3508 3492 3762 3675 3504 3458 3367 3510 3589 3

3273 3257 3408 3558 3615 3522 3258 3301 3081 3484 3605 3

2930 2989 3173 3230 3238 2902 2991 3124 2392 3170 3096 32727 2573 2572 2547 2793 2610 2564 2878 2335 2608 2678 2

2235 2346 2299 2281 2472 2407 2265 2391 2230 2348 2343 2

2167 2194 2171 2113 2194 2227 1994 2280 2092 2189 2127 21886 1986 1979 1979 2053 2049 1968 2064 1938 1953 1959 1

1822 1920 1878 2053 2232 1954 1872 1953 1874 1947 1918 2

1809 1581 1874 1870 1864 1928 1872 1904 1852 1933 1900 11836 1890 1893 1915 1864 1923 1888 1881 1879 1934 1953 1

1948 2371 2139 2142 2194 2144 2197 2009 2202 2191 2199 2

2492 2510 2557 2615 2614 2668 2618 2552 2619 2502 2516 22795 2741 2902 2889 2889 2988 2826 2820 2791 2877 2686 2

1481 2322 2553 2601 2544 2108 2153 2183 2099 2177 2254 2

0 1666 1908 1704 1840 1568 1768 1693 1827 1626 1745 10 1386 1504 1432 1616 1433 1400 1396 1392 1392 1476 1

0 1184 1176 1200 1216 1288 1144 1192 1152 1296 1224 1

0 1185 1180 1176 1096 1216 1120 1136 1152 1176 1216 1

0 1564 1032 1184 680 1288 1120 1072 1192 1080 1248 11304 1576 1088 1320 1088 1264 1128 1136 1230 1082 1368 1

608 2164 1144 1216 1128 1264 1064 1184 1094 1240 1352 1960 1102 1417 1144 1128 1150 1128 1064 1192 1152 1252 1

1216 890 1411 1144 1128 1174 1212 1080 1144 1152 1176 1

1296 280 806 2223 0 982 2246 1160 1192 1112 1208 11200 288 798 1065 1109 958 1137 565 1079 1086 339 1


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Average Load Curve (1-25 October 2003) of KLP Sinar Rinjani

0,00

500,00

1000,00

1500,00

2000,00

2500,00

3000,00

3500,00

4000,00

1700

1730

1800

1830

1900

1930

2000

2030

2100

2130

2200

2230

2300

2330

2400

0100

0200

0300

0400

0430

0500

0530

0600

0630

0700

0800

0900

Hour

K

iloWatt

Average Load


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Annex 3. Pre-FS Survey Result

Lighting technology

Lighting respondent 1 2 3 4 5 6 7 8

Bulbs 1 1 1 1 1 1 1 1

2,5 watt 15 watt 1 1 1 1 110 watt 1 1 115 watt 125 watt 1 1 140 watt60 watt 175 watt

100 watt

Fluorescent 1 1 1 1 1 1

10 watt 1 1 1 1 1 120 watt 1

CFL 1 1 1 1 1

18 watt 1 1 1 111 watt 1 15 watt

how many type of lighting 1 1 3 3 3 2 3 3


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13 14 15 16 17 18 19 20 21 22 231 1 1 1 1 1 1 1 1 1 1

11 1 1 1 1 1 1 1 1

1 1 1 1 1 1 1

1 1 1 11

1 1 1 1 1 1 1 1 1 11 1 1 1 1 1 1 1 1

1 1

1 1 1 1 1 1 11 1 1

1 1 1 11 1

3 3 3 2 3 3 3 3 1 2 2


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28 29 30 31 32 33 34 35 36 37 381 1 1 1 1 1 1 1 1 1 1

11 1 1 1 1 1 1 1 1

11 1

1 1 11 1 1

1 1 11

1 1 1 1 1 1 1 11 1 1 1 1

1 1 1

1 1 1 1 1 1 11 1 1

1 1 11 1

2 3 3 3 2 3 2 3 2 1 2


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43 44 45 46 47 48 49 50 51 52 531 1 1 1 1 1 1 1 1 1 1

1 1 1 1 1 1 1 1

1 11 1 1 1 1

1 1 1 11

1 1 1 1 1 11 1 1

1 1 1 1 1

1 1 1 1 1 1 1 11 1 1

1 1 1 1 11 1 1 1 1

2 2 1 2 2 3 3 3 2 2 3


36/45


58 59 60 61 62 63 64 65 66 67 681 1 1 1 1 1 1 1 1 1

1 1 1 1 1 1 1

11 1

1

1 1 1 1 1 1 1 1 11 1 1 1 1 1

1 1 1 1 1 1

1 1 1 1 1 1 1 1 11

1 1 1 1 1 1

1 1 1

2 3 3 2 3 3 3 2 1 3 3


37/45

PREGA Phase 2 - ADB TA REG 5972 Annex-10

Annex 4. Percentage of lighting and other load for domestic

hour Lighting Appliances Total % lighting % non-light

1 1137 2845 3982 28,55% 71,45%2 1137 2845 3982 28,55% 71,45%3 1137 2845 3982 28,55% 71,45%4 2520,5 2870 5390,5 46,76% 53,24%5 3911,5 3135 7046,5 55,51% 44,49%6 1971 3675 5646 34,91% 65,09%7 5 3835 3840 0,13% 99,87%8 5 3955 3960 0,13% 99,87%9 5 4235 4240 0,12% 99,88%

10 5 4820 4825 0,10% 99,90%11 5 4685 4690 0,11% 99,89%12 5 4445 4450 0,11% 99,89%13 5 3985 3990 0,13% 99,87%14 5 3955 3960 0,13% 99,87%15 5 4270 4275 0,12% 99,88%16 45 4295 4340 1,04% 98,96%17 76 4275 4351 1,75% 98,25%18 6079 4145 10224 59,46% 40,54%19 6781 5035 11816 57,39% 42,61%20 6656 6310 12966 51,33% 48,67%21 6007 6380 12387 48,49% 51,51%22 5388,5 6090 11478,5 46,94% 53,06%23 3185 4545 7730 41,20% 58,80%

24 1547 3360 4907 31,53% 68,47%

Percentage of load


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Annex 5. Load Simulation

watt watt watt survey load average from engine

hour Lighting Other Total % lighting % non-light load (kW) loss 100% load

a b c d e f g h

a+b (a/c)*100%(b/c)*100% f-(f*g)1 1137 2845 3982 29% 71% 1922,36 36% 1238,854

2 1137 2845 3982 29% 71% 1913,24 36% 1232,9773 1137 2845 3982 29% 71% 1842,28 36% 1187,2474 2520,5 2870 5390,5 47% 53% 1870,76 36% 1205,6015 3911,5 3135 7046,5 56% 44% 2502,68 36% 1612,838

6 1971 3675 5646 35% 65% 2368,75 36% 1526,5287 5 3835 3840 0% 100% 1450,043 36% 934,47258 5 3955 3960 0% 100% 1201,917 36% 774,56859 5 4235 4240 0% 100% 1149,905 36% 741,0497

10 5 4820 4825 0% 100% 1181,941 36% 761,695411 5 4685 4690 0% 100% 1216,167 36% 783,751912 5 4445 4450 0% 100% 1179,389 36% 760,050613 5 3985 3990 0% 100% 1127,952 36% 726,902614 5 3955 3960 0% 100% 1127,952 36% 726,902615 5 4270 4275 0% 100% 1174,882 36% 757,1464

16 45 4295 4340 1% 99% 1074,105 36% 692,201217 76 4275 4351 2% 98% 1130,571 36% 728,590518 6079 4145 10224 59% 41% 1521,958 36% 980,817619 6781 5035 11816 57% 43% 3755,542 36% 2420,238

20 6656 6310 12966 51% 49% 3774,48 36% 2432,44321 6007 6380 12387 48% 52% 3577,72 36% 2305,64222 5388,5 6090 11478,5 47% 53% 3379,2 36% 2177,70723 3185 4545 7730 41% 59% 2555,36 36% 1646,78824 1547 3360 4907 32% 68% 2120,68 36% 1366,66

46119,84


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kW kW watt watt watt kW kW kW

remainingload 1

lightingload 1

lighting

loadsurvey

lighting loadsimulation

difference

percentag

e of

surveyload

improved

lightingload

improved

remainingload

imploa

l m n o p q r s

h-(i+j+k) i*d % m-(m*q) r+(l-m) s+

1094,246 312,4454 1137 638 499 43,89% 175,3211 957,1215 1

1088,368 310,7672 1137 638 499 43,89% 174,3795 951,9807 10

1042,639 297,7097 1137 638 499 43,89% 167,0526 911,9815 11060,992 496,1008 2520,5 1272,5 1248 49,51% 250,4615 815,3531 95

1468,23 815,0118 3911,5 1887,5 2024 51,74% 393,2851 1046,503 111381,919 482,4235 1971 1129 842 42,72% 276,3349 1175,831 13

929,7748 1,210644 5 5 0 0,00% 1,210644 929,7748 93666,1792 0,841135 5 5 0 0,00% 0,841135 666,1792 77

632,6604 0,746062 5 5 0 0,00% 0,746062 632,6604 74

653,3061 0,677001 5 5 0 0,00% 0,677001 653,3061 76675,3625 0,720003 5 5 0 0,00% 0,720003 675,3625 78

651,6613 0,732204 5 5 0 0,00% 0,732204 651,6613 76722,205 0,905019 5 5 0 0,00% 0,905019 722,205 72

618,5133 0,780951 5 5 0 0,00% 0,780951 618,5133 72

648,7571 0,75878 5 5 0 0,00% 0,75878 648,7571 75583,8118 6,053348 45 15 30 66,67% 2,017783 579,7763 68

723,8928 12,64442 76 36 40 52,63% 5,98946 717,2378 72

976,1199 580,3827 6079 2825 3254 53,53% 269,7123 665,4495 672275,629 1305,945 6781 3156 3625 53,46% 607,8103 1577,495 17

2287,834 1174,443 6656 3129 3527 52,99% 552,1081 1665,5 182161,033 1047,98 6007 2914 3093 51,49% 508,3758 1621,429 17

2033,098 954,4234 5388,5 2676,5 2712 50,33% 474,0678 1552,743 16

1502,179 618,9444 3185 1485 1700 53,38% 288,5816 1171,816 131222,052 385,2689 1547 912 635 41,05% 227,1268 1063,91 12


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kW kW kW kW kW kW kW

improved load

2 (RMU highseason)

improved load

3 (RMU lowseason)

improved

average load 1(only lighting)

improved

average load

1 (RMU High)(kW)

improved

average load

2 (RMU Low)(kW)

30% losslighting

30% loss

lighting +RMU

w x y z aa ab ac

t+u t+v t/(1-g) w/(1-g) x/(1-g) t/(1-30%) w/(1-30%)

1101,73 1101,73 1709,58 1709,58 1709,58 1573,9 1573,9

1096,59 1096,59 1701,60 1701,60 1701,60 1566,556 1566,5561056,59 1056,59 1639,54 1639,54 1639,54 1509,414 1509,414

959,96 959,96 1489,60 1489,60 1489,60 1371,374 1371,3741191,11 1191,11 1848,28 1848,28 1848,28 1701,588 1701,588

1320,44 1320,44 2048,96 2048,96 2048,96 1886,342 1886,342

934,47 934,47 1450,04 1450,04 1450,04 1334,961 1334,961

892,08 774,57 1201,92 1384,26 1201,92 1106,526 1274,398

858,56 741,05 1149,90 1332,25 1149,90 1058,642 1226,514879,21 761,70 1181,94 1364,28 1181,94 1088,136 1256,008901,26 783,75 1216,17 1398,51 1216,17 1119,646 1287,517

877,56 760,05 1179,39 1361,73 1179,39 1085,787 1253,658

726,90 726,90 1127,95 1127,95 1127,95 1038,432 1038,432726,90 726,90 1127,95 1127,95 1127,95 1038,432 1038,432

874,66 874,66 1174,88 1357,23 1357,23 1081,638 1249,509805,68 688,17 1067,84 1250,19 1067,84 983,0937 1150,965

839,45 721,94 1120,24 1302,59 1120,24 1031,336 1199,208

787,66 670,15 1039,88 1222,23 1039,88 957,3531 1125,2251722,10 1722,10 2672,23 2672,23 2672,23 2460,148 2460,148

1810,11 1810,11 2808,79 2808,79 2808,79 2585,869 2585,8691766,04 1766,04 2740,40 2740,40 2740,40 2522,911 2522,911

1697,35 1697,35 2633,82 2633,82 2633,82 2424,787 2424,7871316,42 1316,42 2042,73 2042,73 2042,73 1880,607 1880,607

1208,52 1208,52 1875,29 1875,29 1875,29 1726,455 1726,455

39248,93 40890,02 39431,27 36133,93 37644,78


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Annex 6. Financial and Economic Feasibility Calculation

Project Financial Summary

Technical Information

Annual Generation kWh 12.176.765

Transmission Losses % 25

Grid Availability % 95

Annual Sales kWh 8.523.736

Life Span years 20

Residential Customers HH 13.088

Revenue

Power Sales

Average Sales Price IDR/kWh 1.200

Annual Price Increase % 3

Annual Revenue IDR 10.228.482.600

CER Revenue

Baseline Emission tons 5.125

Project Emission tons 3.653

Annual Emission Reduction tons 1.472

Emission Factor kg/kWh 0,30

GHG Abatement Price $/ton 5

Annual CER Revenue $ 7.359

Total Revenue IDR 10.299.133.752

Project Cost

Survey IDR 15.000.000

Meters and CFL

Dual Tariff kWh Meter $ 225.000

CFL Lamps IDR 754.500.000

Installation

Training for Installer IDR 10.000.000

Meter Installation Material IDR 30.000.000

Labour IDR 40.000.000

Contingency IDR 25.000.000

Total Project Cost IDR 2.997.000.000

Annual Operation and Maintenance

Generation

Fuel IDR 8.089.911.285

Lubricants IDR 130.416.000

Maintenance IDR 192.222.000


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Network

Transformer Maintenance IDR 82.831.404

Poles Maintenance IDR 28.931.148

Task Force IDR 12.150.000

Billing and Selling

Wages IDR 37.224.996

Bill Collection IDR 165.864.000

Meter and Installation Checking IDR 19.080.000

Administration

Wages IDR 734.559.492

Office Stationary IDR 74.789.004

General Expenditures IDR 114.255.996

Total OM Cost IDR 9.682.235.325

Others

Exchange Rate 1 USD IDR 9.500

Inflation Rate % 7

Discount Rate % 12


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Annex 7. Estimation of Overall Cost

Estimation of Overall Cost

Financialprice Financial price Adjusment*

Economicprice

USD (IDR'000) (IDR'000)

Revenue

Power Sales 1.076.682 10.228.483 1,000 10.228.483

CER Revenue 7.359 69.915 0,749 52.366

1.084.042 10.298.398 10.280.849

Investment

Survey 1.579 15.000 0,914 13.708

Meters and CFL 304.421 2.892.000 0,914 2.642.872

Installation 8.421 80.000 0,914 73.108

Contingencies 2.632 25.000 0,914 22.846

317.053 3.012.000 2.752.535Annual operation andmaintenance

Generation 885.532 8.412.554 0,914 7.687.865

Network 13.043 123.909 0,914 113.235

Billing and Selling 23.386 222.167 0,914 203.029Administration andoverhead 97.222 923.609 0,914 844.046

1.019.183 9.682.239 8.848.174

Total cost 1.336.236 12.694.239 11.600.709


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Annex 8. Financial Analysis

Financial Analysis

Revenue Cost

YearPowersales Power CER Total Investment O&M Total

NetBenefitswith CER

NetBenefitswithoutCER

MWhMil

IDRMil

IDR Mil IDR Mil IDR Mil IDRMil

IDR Mil IDR Mil IDR

0 2006 - - - 2.997 - 2.997 (2.997) (2.997)

1 2007 8.524 10.228 70 10.298 9.682 9.682 616 546

2 2008 8.524 10.228 70 10.298 9.682 9.682 616 546

3 2009 8.524 10.228 70 10.298 9.682 9.682 616 546

4 2010 8.524 10.228 70 10.298 9.682 9.682 616 546

5 2011 8.524 10.228 70 10.298 9.682 9.682 616 546

6 2012 8.524 10.228 70 10.298 9.682 9.682 616 546

7 2013 8.524 10.228 70 10.298 9.682 9.682 616 546

8 2014 8.524 10.228 70 10.298 9.682 9.682 616 546

9 2015 8.524 10.228 70 10.298 9.682 9.682 616 546

10 2016 8.524 10.228 70 10.298 9.682 9.682 616 546

11 2017 8.524 10.228 70 10.298 9.682 9.682 616 546

12 2018 8.524 10.228 70 10.298 9.682 9.682 616 546

13 2019 8.524 10.228 70 10.298 9.682 9.682 616 546

14 2020 8.524 10.228 70 10.298 9.682 9.682 616 546

15 2021 8.524 10.228 70 10.298 9.682 9.682 616 546

16 2022 8.524 10.228 70 10.298 9.682 9.682 616 546

17 2023 8.524 10.228 70 10.298 9.682 9.682 616 546

18 2024 8.524 10.228 70 10.298 9.682 9.682 616 546

19 2025 8.524 10.228 70 10.298 9.682 9.682 616 546

20 2026 8.524 10.228 70 10.298 9.682 9.682 616 546

PV@ 12,00% 170.475 68.215 466 68.682 2.676 64.572 67.248 1.433 967Per unit

(IDR/kWh) 400,15 2,74 402,88 15,70 378,78 394,48 8,41 5,67WithCER

revenue

WithoutCER

revenue

FIRR 20,03% 18%FNPV@ 20,03% 0 (283)FNPV@ 12,00% 1.433 967


45/45

Annex 9. Economic Analysis

Economic Analysis

Benefit CostPowersales Power

CERTotal

InvestmentO&M Total

NetBenefitswithCER

NetBenefitswithoutCER

Year

GWhMil

IDRMil

IDR Mil IDR Mil IDR Mil IDR Mil IDR Mil IDR Mil IDR

0 2006 - - - 2.753 - 2.753 (2.753) (2.753)

1 2007 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

2 2008 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

3 2009 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

4 2010 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

5 2011 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

6 2012 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

7 2013 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

8 2014 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

9 2015 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

10 2016 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

11 2017 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

12 2018 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

13 2019 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

14 2020 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

15 2021 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

16 2022 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

17 2023 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

18 2024 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

19 2025 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

20 2026 8.524 10.228 52 10.281 - 8.848 8.848 1.433 1.380

PV@ 12,00% 170.475 68.215 349 68.564 2.458 59.010 61.467 7.097 6.748Per unit(IDR/kWh) 400,15 2,05 402,20 14,42 346,15 360,57 41,63 39,58

With CERrevenue

WithoutCER

revenue

EIRR 52,04% 50%ENPV@ 52,04% 0 (66)ENPV

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