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Outline 1. Tahapan didalam proses Pengembangan Proyek Energi Terbarukan (PPET) 2. Feasibility Study and Detail Engineering Design (DED) documents 3. Underlying Laws/Regulation 4. Licensing and Permits
Outline 1. Tahapan didalam proses Pengembangan Proyek Energi Terbarukan (PPET) 2. Feasibility Study and Detail Engineering Design (DED) documents 3. Underlying Laws/Regulation 4. Licensing and Permits
Project Initiation
Feasibility Study
PPA
Financing
Constructi on
COD
O&M
Tahap Perencanaan
Tahap Konstruksi
Tahap Operasional
Small-scale renewable energy Independent Power Project (IPP) may take 3 to 5 years from the project initiation to commercial operation date (COD), during which Project Sponsor would have to identify project opportunity, conduct feasibility study, enter into a Power Purchase Agreement (PPA) with PLN as the traditional off-taker, seek financing commitment, and implement the construction work.
Proses PPET
2 - 3 month 3 - 6 month 6 - 12 month 12 month
1. Ijin Lokasi 2. Pemanfaatan Air 3. Forestry 4. SIPA 5. ..
24 month
6. Ijin Lokasi 7. Pemanfaatan Air 8. Iijin 9. Ijin 10. Ijin
PEMDA
LAND ACQUISITION
DEVELOPER
IDENTIFY PROJECT
APPLY PERMITS
FEASIBILITY STUDY
SUBMIT PROPOSAL
NEGOTIATING LOAN
FINANCIAL CLOSURE
CONSTRUCT PLANT
OPERATE
9
COMMISION
ADDITIONAL INFORMATION
6
PLN
MOU (Optional)
SIGN PPA
8
REVIEW PROPOSAL
FEED IN TARRIF
PURCHASE POWER
LENDER
REVIEW PROPOSAL
LETERS OF INTENTS
LOAN AGREEMENT
INITIAL FUNDING
# = Potential issues
Outline 1. Tahapan didalam proses Pengembangan Proyek Energi Terbarukan (PPET) 2. Feasibility Study and Detail Engineering Design (DED) documents 3. Underlying Laws/Regulation 4. Licensing and Permits
Feasibility Study
Outline 1. Tahapan didalam proses Pengembangan Proyek Energi Terbarukan (PPET) 2. Feasibility Study and Detail Engineering Design (DED) documents 3. Underlying Laws/Regulation 4. Licensing and Permits
12%
Ministry of Energy and Mineral Resources Vision 25/25: Set a more ambitious target, achieving renewable energy utilization up to 25% of national energy mix, and using energy efficiency initiative, reduce energy demand by 34% compared to the business-as-usual scenario PLN power generation development policy: Development of renewable energy resources does not necessarily adhere to the least-cost principle, while maintaining reserve margin criteria and readiness of project development (since RUPTL 2009)
RE Pricing Regulation
MEMR Regulation 4/2012 on Feed-In Tariff for RE (Hydro, Wind, & PV)
PPA Price Connection to Medium Voltage (20 kV T/L): P = Rp 656/kWh x F Connection to Lower Voltage (220/380 Volt Lines): P = Rp 1,004/kWh x F Regional Adjustment Java and Bali, F =1 Sumatera and Sulawesi, F = 1.2 Kalimantan, NTB, NTT, F = 1.3 Maluku and Papua, F = 1.5
The regulation allow for higher negotiated PPA price, but subject to approval from MEMR For excess power, contracted capacity can be larger than own use For geothermal power project, capped at US cent 9.7/kWh
RE Pricing Regulation
PPA Price
Connection to Medium Voltage (20 kV T/L): P = Rp 975/kWh x F Connection to Lower Voltage (220/380 Volt Lines): P = Rp 1,325/kWh x F
Regional Adjustment
Java, Madura, Bali, and Sumatera: F =1 Sulawesi, Kalimantan, NTB, NTT: F = 1.2 Maluku and Papua, F = 1.3
RE Pricing Regulation
PPA Price
Connection to Medium Voltage (20 kV T/L): P = Rp 975/kWh x F Connection to Lower Voltage (220/380 Volt Lines): P = Rp 1,325/kWh x F
Regional Adjustment
Java, Madura, Bali, and Sumatera: F =1 Sulawesi, Kalimantan, NTB, NTT: F = 1.2 Maluku and Papua, F = 1.3
6.
Outline 1. Tahapan didalam proses Pengembangan Proyek Energi Terbarukan (PPET) 2. Feasibility Study and Detail Engineering Design (DED) documents 3. Underlying Laws/Regulation 4. Licensing and Permits
Licenses/Permits:
Corporate Licenses (1)
No 1 Provision In case of foreign shareholder - the Approval Letter of Foreign Capital Investment ("SP-PMA") Minister of Law and Human Rights (MOLHR) approval of the IPPs deed of establishment. Key Issues The first step in establishing of a Foreign Capital Investment (PMA) company (for the purpose of this memorandum hereinafter referred to as IPP) begins with the foreign investors submission of an application addressed to the Chairman of BKPM. BKPM will then issue an SP-PMA addressed to the applicant, with copies to the related Indonesian Government agencies. Please note that BKPM usually requires a recommendation from the Department of Energy and Mineral Resources for the establishment of a PMA company engaging in private power business. Once the SP-PMA has been obtained, a deed of establishment of the IPP must be executed in notarial deed form before a notary public. Once executed, the notary public must submit the deed of establishment to MOLHR for approval within 60 days after execution accompanied by supporting documents. Upon completion of the submission, MOLHR shall immediately electronically declare his non-objection to such application. Within 30 days after the statement of non-objection, the applicant (by its notary) is obligated to physically deliver the application letter including its supporting documents. Within 14 days after receiving the complete physical documents, MOLHR shall issue its approval of the deed of establishment. Upon receiving approval from MOLHR, the IPP becomes a legal entity. The company data will be administered by MOLHR in its Company Register. The SKDP is required before the IPP can obtain Taxpayer Registration Number (NPWP) and must be obtained before the IPP may open the account or submit the Articles to the MOLHR. The SKDP can be obtained from the office of the head of the city or village in which the IPP will be domiciled once the IPP has established an office and obtained a letter from the building manager stating that it resides in that building.
Certificate of Domicile (SKDP) issued by the Head of Sub District in which the IPP is domiciled.
Licenses/Permits:
Corporate Licenses (2)
No 4 Provision Registration of the Deed of Establishment with the Department of Trade (DOT). Key Issues In addition to the Company Register administered by MOLHR, DOT also maintains a Company Register. DOT registration will need to be submitted after obtaining MOLHR approval. A Company Registration Certificate ("TDP") will be issued upon filing. The TDP is valid for five years. Law No. 3/82 provides criminal sanctions for a failure to register of three months imprisonment or a fine of three million Rupiah). However, these sanctions have not, to our knowledge, ever been imposed in practice. The first DOT registration would be handled by the notary who notarizes the Articles.
Corporate Financial Year The IPP shall file its audited financial statements to the DOT at the latest by six months after the financial year ended. Reports (Pendaftaran Laporan Keuangan Tahunan Perusahaan or LKTP) Report on Domestic and Foreign Capital Investment Activities (Laporan Kegiatan Perusahaan Penanaman Modal Dalam Negeri dan Penanaman Modal Asing or "LKPM") in case of foreign shareholder If the IPP does not possess a Permanent Operating License (IUT), the LKPM must be submitted to the BKPM twice a year, not later than July 31 of the relevant year for the period from January 1 through June 30 and not later than January 31 of the following year for the period from July 1 through December 31. If the IPP is already in commercial operation and has obtained an IUT, the LKPM must be filed annually, not later than January 31 of the relevant year for the previous calendar year.
Licenses/Permits:
Tax and Electricity Business Licenses
No
7 NPWP
Provision
The NPWP is a Taxpayer registration number.
Key Issues
The PKP is required for the IPP to become the Value Added Tax (VAT) collector. The PKP is a VAT registration number. VAT will be payable on any invoice issued for taxable goods and services rendered in Indonesia. VAT is imposed on most goods and services at a rate of ten percent. VAT is generally collected by entities having PKPs. While some goods and services are exempted from VAT by government regulation, the delivery of electricity by IPP to PLN is subject to VAT. This license is required to enable the IPP to conduct the supply of electric power for public interest. IUKU for electric power supply for inter-province or that is connected with the National Transmission Grid (Jaringan Transmisi Nasional or JTN) shall be issued by the Minister of Energy and Mineral Resources (MEMR) through the Director General of Electricity and Energy Development (DGEED). By contrast, IUKU for supply of electricity for regional areas which is not connected with the JTN shall be issued by the relevant regent / municipal government and IUKU for supply of electricity for inter-regent or inter-city which is not connected to JTN shall be issued by the relevant governor.
Permit for Electric Power Business for Public Interest (Izin Usaha Ketenagalistrikan Untuk Kepentingan Umum or commonly referred to as an IUKU)
Licenses/Permits:
Land and Building Licenses (1)
No 10 Provision Location Permit for the power plant Key Issues The location permit is a license granted to a company to acquire the land in accordance with the local and regional land use planning requirements.The location permit is issued by the regent or the municipal government based upon the recommendation of the local BPN supervising the area in which the electric power project is located. Once the location permit is issued, the IPP can start its activities to acquire the land including certification of title. The validity period of a location permit is based on the total area of land, varying from one year to three years and can only be extended one time for one additional year. The procedures for obtaining location permit will be subject to local regulations where the electric power project is located. A location permit is not required where the land needed to implement a project is less than 10,000 square meters. A HGB title grants the titleholder the right to use and develop the land. By having HGB title, the IPP can construct buildings and use the land. A HGB title is granted for a maximum term of 30 years, extendable for another 20 years. At the end of the 50-year period, the title could then be renewed for another 30 years subject to the limited discretion of the Government. A Hak Pakai title also grants the titleholder the right to use and develop land. A Hak Pakai title would allow a titleholder to construct and operate the Project over the land. Hak Pakai may be granted for a maximum period of 25 years and can be extended for a maximum period of 20 years. Given he lesser term of Hak Pakai, an IPP should obtain HGB title. The subject HGB title should be over State land which means that there would be no other underlying title holder so that the IPP can apply to the local BPN office for the relevant extension or renewal without requiring the consent of any underlying title holder.
11
Right to Build (Hak Guna Bangunan or HGB) or Right to Use (Hak Pakai)
Licenses/Permits:
Importation and Labor Licenses
No 19 Provision Import Duty Exemptions and Master List Approval Key Issues PMA companies may be entitled to certain exemptions, reductions and deferrals of import duties and taxes for raw materials and capital equipment goods identified on a BKPM-approved Master List. The Master List must be prepared and submitted to BKPM for approval. The Master List describes the capital goods to be imported for the construction/operation of its facility and for the importation of raw materials. In order to import the capital goods and raw materials identified on a Master List, the IPP needs to obtain an APIT, which constitutes the license to import the same. Companies employing more than ten employees are obliged to register themselves and their employees as Jamsostek participants.
20
21
22
23
Working places involving the generation, transformation, allocation, storage or distribution of electricity, gas, water and oil must comply with this Work Safety Law. The safety conditions have been more specifically set forth in implementing regulations in relation to the planning, production, transportation, circulation, marketing, installation, use, application maintenance and storage of materials, goods, technical products and means of production, which involve or may cause a danger of accident. For the installation of electrical equipment or machinery in a workplace, the prior approval of the Supervision Directorate of Work Safety Norms, Companys Hygiene and Workers Health of the local DOMT must be obtained. Use of electrical equipment or machinery in a workplace should also comply with the workers safety requirements and is subject to a separate prior approval of the same health and safety Directorate. In the event the IPP intends to employ expatriate, such expatriate shall first obtain the work permit.