Tidal power developers bet on sea

JAKARTA: A well-connected Indonesian marine renewable energy company and OpenHydro, a unit of French state-owned naval defence company DCNS, aim to be the first to plug into the vast untapped tidal energy potential of the world’s biggest archipelago.

Renewables have so far played little part in Indonesia’s power sector, despite the country sitting on the world’s biggest geothermal reserves and being bathed in year-round sunshine, crowded out by an abundance of cheap coal and bureaucratic bottlenecks.

But declining costs of renewable electricity and a new push by President Joko Widodo to develop renewables in the remote eastern parts of the archipelago are changing the picture.

With narrow straits straddling the Indian and Pacific oceans, Indonesia has significant tidal power potential, and PT Arus Indonesia Raya (AIR) and OpenHydro plan to build the country’s first such project.

“This project is important for Indonesia and the world so we can stop burning coal,” AIR president director Panji Adhikumoro Soeharto said.

OpenHydro, a company specialising in the design and manufacture of marine turbines to generate renewable energy from tidal streams, already has projects in Japan, the United Kingdom, France and Canada.

The AIR and OpenHydro model would appeal to renewable energy investors because it is relatively inexpensive and low in maintenance compared with other renewables, said Mr Soeharto, grandchild of former Indonesian president Suharto.

“We’re doing the investment ourselves, with banks,” he said.

He did not say how much had been invested so far.

According to the partners, Indonesia has the potential for up to 60 gigawatts of tidal power, more than Indonesia’s total electricity capacity of just over 50 gigawatts last year.

Land and permitting issues that often hold up power infrastructure projects should be no obstacle for AIR, Mr Soeharto said, referring to plans to build a factory in Indonesia and utilise 70% local content in their turbines.

The turbines, which sit on the seabed, can cost up to US$7 million (about 249 million baht) each in Europe, a cost PT AIR plans to slash to as little as $4 million, Mr Soeharto said.

“The only thing we can’t produce is the magnets — French technology.Maybe in future we’ll study this.”

Over the next three years, the two companies plan to develop up to 20 two-megawatt turbines in a pilot tidal array in the Bali strait, which will supply power directly to state energy company Pertamina, Soeharto said.

According to a release on the DCNS website, the Indonesian project is targeted to reach 300MW of installed capacity by 2023.

Indonesia wants renewable energy to make up around a quarter of its total by 2025 from around 5% now, though critics have questioned its seriousness in meeting its climate goals, and its overall plans to ramp up power production have got off to a slow start.

Yet attitudes toward renewable energy among Asian investors are changing as costs come down and environmental pressures mount, a Singapore-based hedge fund manager said.