Korea Electric Power Corporation ( KEPCO ) has announced that it will continue to develop a thermal power project worth $3.2 billion in Indonesia. The announcement follows strong opposition to the project from political circles in South Korea, including from the ruling part, and South Korean environmental and civic groups. KEPCO said that it could not delay the project any longer as it passed a preliminary feasibility study.
KEPCO discussed the Indonesian thermal power plant project at a board meeting on 26 June.
The Jawa project is a $3.2 billion project to build two coal-fired power plants, Jawa 9 and 10, near Jakarta. KEPCO will establish a joint venture with Indonesia Power to carry out the project. KEPCO plans to make an equity investment of $51 million and provide a loan guarantee of $250 million. Doosan Heavy Industries & Construction has won a $1.3 billion construction order.
KEPCO had been under pressure from the Korean government and the ruling Democratic Party to withdraw from the project, due to the recently announced Green New Deal policy aimed at expanding renewable energy generation. Civic groups also demanded KEPCO’s withdrawal, saying that the Korea Development Institute (KDI)’s preliminary feasibility study showed that KEPCO would suffer a loss of around $8.8 million.
KEPCO, however, has been seeking to enter the Indonesia private power generation market since 2002, as there is big growth potential. The Indonesian government will place orders for private power generation projects amounting to more than 30GW over the next 10 years.