Articles

Financial Impact Analysis of Carbon Pricing on Geothermal Power Plant Project Investment at PT PLN (Persero)

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Climate change is a significant global challenge, mainly driven by greenhouse gas (GHG) emissions. The energy sector is a major contributor to GHG emissions, accounting for approximately 73% of global emissions in 2022. Within the energy sector, electricity emitted 13 GtCO2 or contributes approximately 35% of global emissions related to energy. To address this challenge, PLN, a state-owned electrical utility in Indonesia, has declared a roadmap to achieve Net Zero Emissions by 2060. The company has also implemented some strategic initiatives to achieve the goal. Carbon pricing is one of the key efforts that enable PLN to receive incentives for reducing GHG emission while also enhancing financial performance. This study examines effects of implementing a carbon trading mechanism on the financial metrics of a 110 MW Geothermal Power Plant project investment. The results demonstrate a 13.58% increase in NPV, a faster payback period from 8.37 to 7.67 years, and a 0.31% rise in the MIRR. These results indicate the potential improvements in project investments financial performance that PLN can achieve while still aligning with global environmental objectives.

Modular and Phased Approach: Innovative Transition Approach in Developing the First Indonesia’s Green Energy Terminal

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This paper explores the modular and phased approach to developing Indonesia’s first green energy terminal by EHS, a company with extensive experience in energy distribution and logistics. The study emphasizes the benefits of this strategy in managing high capital requirements and uncertain revenue streams. Through qualitative research employing Soft Systems Methodology (SSM), this study identifies the advantages of incremental development and stakeholder engagement in achieving sustainable and practical outcomes. The findings provide valuable insights for policymakers and practitioners in developing countries facing similar challenges in the energy transition.

The Oilfield Service Company’s Business Development Strategy towards a Sustainable Energy with Scenario Planning

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Since the Paris Agreement where the countries in the world commit for the carbon emission reduction and net zero in 2050 or sooner, the energy transition has become the top topic in the energy sector. The oil-field services (OFS) industry is one of the business actors in the O&G supply chain with complex value chains, business structures, and models, and this research will explore scenario planning on the energy sector in Indonesia to have a forward-looking view of future O&G conditions in Indonesia including the energy transition which later became the key focal issue in this research. Scenarios are made based on the key driving factors and uncertainties that have been identified through the analysis of primary data from stakeholder interviews and secondary information from various literature studies. Furthermore, Scenarios are constructed based on how society responds to sustainable consumption and supporting infrastructures such as regulatory policies, the economic and investment environment, as well as technology and innovation. The four scenarios are (i) Empty Boat, (ii) Leaking Boat, (iii) Rocking the boat, and (iv) Rowing to Win. This research describes the implications, options, and strategies for each scenario which can then be taken into consideration by Green Bay Hornet Company (GBH) as an OFS company to enable proactive decisions and evaluate strategies to be resilient in each scenario. Reassessing the energy market, business conditions, and core competencies and how to expand and diversify technology, product, and service portfolios to renewable energy and decarbonizing initiatives in their operation is some of the strategies to expedite the transition in 2035.

Renewable Energy Transition Strategy for PT.CI to Reduce 50% Emission by 2030

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The global and Indonesia energy trend is heading to process of transitioning from fossil fuel to renewable energy (decarbonization) in the purpose of reducing Green House Gas (GHG) effects. Industries as one of the biggest contributors of emission generator expected to participate in this effort, where fuel and electricity play significant roles in running the operation. Many businesses try to participate and state their commitment on this energy transition initiative by increasing the portion of renewable energy within their operation. Meanwhile, business have several uncertainties’ on how the renewable energy will be acquired and will this renewable energy options be available at the time they need it. Campur Plc. (CP) through its subsidiary in Indonesia, PT. Campur Ilmiah (PT. CI) has targeted the entity to reduce 50% of the emission by 2030 with the baseline of 2018, which align with corporate target of 46.2% of emission reduction globally. Uncertainties on achieving this target generated from external and internal factors, and not to forget how to sustainably maintain the achievement. The location of PT.CI in industrial estate need to be considered as limitation because the power and energy supply are regulated. The accessibility, availability and affordability of renewable energy are expected to be handled by the government, industrial estate or other third party in energy business, but the phasing and the achievement up to now has not shown a promising progress. As a business, PT.CI need to have a strategic planning on this energy transition to support the global target as well as shown a positive investment climate in Indonesia. There are four (4) scenarios has been developed and each of the scenarios are explored to identify alternative and possible strategies to still be able achieving the target and how the organization manage these changes. As the conclusion of this research, four (4) strategic imperatives are defined. This research also might be use as the reference of future planning for the similar industries that have the similar target and type of energy mix.