AEI’s power business provides captive market for the thermal coal, which subjects to cyclical and volatile market, and capture the opportunities from the government’s strategic program to increase national electricity supply. PT Adaro Power (AP), AEI’s subsidiary leading the power segment, has completed a number of coal-fired power plant (CFPP) projects operated by its subsidiaries PT Makmur Sejahtera Wisesa (MSW), PT Tanjung Power Indonesia (TPI), and PT Bhimasena Power Indonesia (BPI). In the last few years, AP together with PT Adaro Clean Energy Indonesia has also been playing an important role in the Adaro Group’s transformation to green business by handling various renewable energy projects, of the Adaro Group’s newest business pillar, i.e. Adaro Green, because AP has the resources (professionals, skills, experience, network, etc.) in the business and operations of the energy sector. The renewable projects which have been and are being developed by the Adaro Group by involving AP include the solar PV and battery energy storage system (BESS) in Kelanis, Central Kalimantan, wind turbines and BESS in Tanah Laut, South Kalimantan, mini hydropower plant in Lampunut, Central Kalimantan, and a hydropower plant to provide clean energy for minerals processing and industrial activities at the green industrial park in North Kalimantan and to support Indonesia’s energy mix diversification.

PT Makmur Sejahtera Wisesa (MSW)

MSW marks AEI’s first downstream step to the power sector in 2013. MSW built, owns and operates AEI’s first power plant of 2x30 MW capacity in Tabalong, South Kalimantan, which supplies power for Adaro Indonesia (AI)’s operations. MSW power plant uses circulating fluidized bed combustion (CFBC) suitable for high-moisture coal combustion like AI’s E4000 product because it can reduce nitrogen oxide emission due to low combustion temperature and the use of electrostatic precipitator for eliminating ash emission. 

In 2023, MSW continued the electrification program for Adaro Indonesia’s mines by adding electricity supply to fulfil the power requirement of 132 electrical pumps and 10 units of other mining facilities, such as office, workshop, WTP and crusher. By consuming MSW’s power of around 75,390 MWh in 2023, AI was able to reduce diesel fuel consumption by around 19.9 million liter in a year, or equivalent to greenhouse gas (GHG) emission reduction of around 52.2 thousand tons CO2.

MSW also continued to operate and maintain power for AEI’s subsidiary PT Indonesia Bulk Terminal (IBT), recording electricity supply of 7,006 MWh for IBT’s operations in 2023.

Msw’s Carbon Reduction Initiatives

CFPP Co-Firing Using Biomass

To reduce the coal consumption of its coal-fired power plant (CFPP), in 2021, MSW started the pilot project for cofiring using biomass, in order to reduce carbon emissions. This project had been continued by co-firing using 5 tons of biomass per day continuously from October 2022 to September 2023, which was then increased to 17 tons of biomass per day continuously in the fourth quarter 2023, or approximately 6% of MSW’s daily coal consumption. With regard to emissions, this number is equivalent to emission reduction of 3,459 tons of CO2 in 2023.

Solar PV at CFPP

Area In 2023, MSW completed the installation of a solar PV with 35 kWp installed capacity at the CFPP area, which then produced 34 MWh power in the same year. This solar PV can reduce coal consumption by around 33 tons/year or equivalent to emission reduction of around 47 tons of CO2/year.

Electrical Vehicles and EVCS

In May 2023, MSW purchased two electrical vehicles for employee transport. Until the end of 2023, the two vehicles had covered around 15 thousand kilometers, which means reduction of diesel fuel consumption by 1,095 liters or equivalent to CO2 emission reduction of around 3 tons.

At the end of 2023, MSW processed the purchase of one unit of electric vehicle charging station (EVCS) with the capacity of 150 KW to support Adaro Indonesia’s electric vehicle program. The company’s EVCS is expected to finish installation by 2Q24.

PT Tanjung Power Indonesia (TPI)

PT Tanjung Power Indonesia (TPI) is a consortium company between AP (65%) and PT EWP Indonesia (35%), a subsidiary of Korea East-West Power Co Ltd., which built and operates 2x100 MW CFPP in Tabalong, South Kalimantan, to sell power to PLN under power purchase agreement of 25 years since the commercial operation date. In 2023 or the fourth year of operations, TPI achieved actual average availability factor 92.2% out of the 83.6% target, and produced 1,297,555.12 MWh power for PLN Kalimantan.

TPI’s Green Initiatives

TPI maintains the commitment to take green initiatives, such as by installing solar PV of 75 kW capacity, which has been used to supply electricity for internal requirements at the office and workshop. The carbon emissions of both TPI’s CFPPs were still below the maximum limit determined by the government for the year. TPI has been registered as a Carbon Exchange Service User and ready to trade in Indonesian Carbon Exchange (IDXCarbon).

PT Bhimasena Power Indonesia (BPI)

The consortium of AP, Electric Power Development Co.Ltd. (J-Power) and Itochu Corporation established PT Bhimasena Power Indonesia (BPI) in 2011 to build 2x1,000 MW CFPP in Batang, Central Java (PLTU Batang), as one of the first and the largest CFPPs in Southeast Asia to use the ultra-supercritical (USC) boiler technology. BPI achieved financial close in June 2016 with total project cost of around $4.2 billion, and received the project funding commitment of around $3.4 billion from Japan Bank for International Cooperation and several commercial financial institutions. BPI has signed power purchase agreement with PLN for a period of 25 years, the first public private partnership realized under the guarantee of the Republic of Indonesia through the Ministry of Finance of the Republic of Indonesia and PT Penjaminan Infrastruktur Indonesia (Persero) and is a part of the Masterplan for the Acceleration and Expansion of Economic Development of Indonesia.

By using the USC technology, the coal combustion process can produce higher efficiency of energy conversion. This advantage does not only produce more units of electricity from each ton of coal used, but also reduces the amount of carbon dioxide (CO2) emissions per unit of energy produced with emission intensity below 0.911 ton CO2e/Mwh.

Both units of PLTU Batang achieved the COD in 2022. In 2023, PLTU Batang recorded actual average availability factor of 85,21% and produced 11.311.912,8 MWh. During the power purchase agreement period, the company will supply power to PLN for covering Java and Bali islands.