ABSTRACT
Due to increasing global awareness of the negative impacts fossil fuels impose on the environment, an energy policy with a priority on the exploitation of available natural resources has obvious benefits for a developing country like Indonesia, especially for rural electrification
Indonesia’s tropical mountainous terrain provides almost unlimited possibilities for small hydropower development. Stand alone off-grid schemes are an economically sound solution for the electrification of remote rural villages beyond the reach of utility grid lines. Spiraling energy demands primarily from the urban industrial centers meanwhile have forced the government to deregulate the power sector in order to meet demand, thus providing investment opportunities for the private power producer. As proof of the governments commitment to promote the exploitation of environmentally friendly energy sources wherever possible, non negotiable small power purchase tariffs (SPPT’s) and standard power purchase contracts will be announced by the ministry of mines and energy shortly. GTZ has been active in the development and dissemination of micro-hydropower technology in Indonesia since 1991. After focusing on stand alone schemes supporting the governments rural electrification for the past five years, the project now enters a new phase hoping to pioneer the development of on-grid schemes selling power to the state owned utility. Past, present and future, the commitment to supply electricity throughout the archipelago determines that Indonesia’s power sector is a dynamic ever changing environment.
