MALUKU: ELECTRICITY WOES PLAGUE AMBON

UNCLAS SURABAYA 000115 SIPDIS E.O. 12958: N/A TAGS: ENRG ECON ID SUBJECT: MALUKU: ELECTRICITY WOES PLAGUE AMBON This message is sensitive but unclassified. Please protect accordingly. ¶1. (SBU) SUMMARY: Technical and maintenance problems at Ambon's power plants have left the island without electricity for up to 14 hours a day. While repairs are expected to be completed soon, long-term development needs require increased electricity capacity. Planned Ambon projects are plagued by land ownership disputes. The provincial government hopes to develop alternative energy to provide electricity to the entire province, but there are no firm plans in place to do so. END SUMMARY 10 Hours of Electricity a Day -------------- ¶2. (SBU) For the past two months, Ambon Island, home to the capital of Maluku province, has regularly experienced blackouts of up to 14 hours each day. The maximum capacity of the two aging diesel power plants that supply electricity to the island equals Ambon's peak demand of32 MW. Other islands in the province receive electricity from other plants but face similar shortages. In September 2009, both of these plants began experiencing severe technical problems, severely limiting their total actual capacity, leading to the extended blackouts. According to the State Electricity Company (PLN),the age of the plants has made finding replacement parts difficult. PLN claims to have found a firm in China able to create the parts; they expect to have the plants fully functional again in December ¶2009. ¶3. (SBU) Lutfi Sanaki, a member of the Maluku Provincial Parliament, said that this electricity crisis impacts business activity and handicaps the provincial government's efforts to attract investment. However, the Maluku Vice Governor, Said Assagaf, said that he didn't think this "temporary problem" would negatively impact long-term growth. He pointed to the province's six years of economic growth over 4% and argued that the power plant would be fixed in time to allow 2009's growth to match that. However, he added that in order to meet future demand, the province needed to provide greater electricity production capacity. ¶4. (SBU) In the medium term, PLN plans to build a new 34 MW coal-fired power plant in 2010 to supplement the two existing plants servicing Ambon. However, Suhfi Madjid, a Member of the Maluku Provincial Parliament, expressed doubts that the project would be completed on time. He pointed out that the project has already been delayed several times due to budget problems and a land ownership dispute involving the plant's planned location. A planned geothermal plant to provide electricity to the province faces similar ownership issues. Anton Lailossa, the head of the Maluku Province Economic Bureau (BAPPEDA),added that once the ownership dispute is settled the geothermal project would take at least two years to be completed. Hopes for Renewable Energy -------------- ¶5. (SBU) Anton said that, in the long term, the province hopes to develop renewable energy such as wind, solar, geothermal and tidal power to provide electricity to the province as a whole. He said that BAPPEDA has already identified a site for a geothermal plant (see above) and that the Maluku Province plans to cooperate with other island provinces to develop tidal energy. The Maluku government met with governments from seven provinces (Maluku, North Maluku, East Nusa Tenggara, West Nusa Tenggara, Riau, Bangka Belitung, and North Sulawesi) in November 2009 to discuss a plan to develop this potential energy source. However, they encountered difficulty formulating a plan of action since no one in Indonesia has experience with tidal energy projects. ¶6. (SBU) Some question the viability of these alternative energy plans. Suhfi Madjid, described both geothermal and tidal power as "political ideas" without any clear implementation plans. Anton noted that Maluku Province cooperated with a Russian company in 2007 to develop a wind power plant. However, the turbines fell apart when they were first switched on. Similarly, Anton said that while the central government provides equipment to the province for solar energy every year, the equipment is fragile and does not last long enough to be useful. MCCLELLAND