Three Reasons Why PLN Scrapped the Sumatra-Java Undersea Cable Project

The dispute over the development of the Sumatra-Java High Voltage Direct Current (HVDC) program, also known as the high-voltage undersea cable project, is intensifying. After being reprimanded by the Ministry of Energy and Mineral Resources (ESDM), PLN explained its reasons for scrapping the project from the electricity supply business plan (RUPTL).

PLN President Director Sofyan Basir said there are at least three main reasons for scrapping the HVDC project. First, the economic value of the project. The development of the HVDC project is considered uneconomical under current conditions. Second, the technical implementation of the project (Read: Government Questions PLN Ability of Funding Power Plant Development Projects).

“Sumatra is still in dire need of power. The RUPTL has allocated 23,000 megawatts (MW) for Java,” said Sofyan at PLN headquarters in Jakarta, Monday (30/5). The final reason is that the HVDC plan outdated and needs to be reviewed.

Sofyan explained that the economy in Sumatra is flourishing, as indicated by the region’s growing usage of electricity. Therefore, he believed that the HVDC project, which distributes electricity from Sumatra to Java was inappropriate. Under the government’s 35,000 MW electricity megaproject, Java already receives the largest portion of electricity produced by the power plants (23,000 MW).

Therefore, Sofyan suggested that if the HVDC project must be executed, electricity should be distributed from Java to Sumatra, not the other way around. The cancellation of this project would not disrupt the development of the South Sumatra 8, 9 and 10 power projects. These three power plants could continue to be developed. The electricity produced from these power plants could then be distributed to Sumatra only.

Previously, Minister of Energy and Mineral Resources (ESDM) Sudirman Said explained that he had reprimanded PLN’s directors for removing the HVDC project from the revised electricity supply business plan. The minister considers a crucial project given Java’s great need for power. “We asked that the HVDC project is included in the RUPTL again,” said Sudirman in his office on Thursday last week. (Read: (Four Factors Hampering 35,000 MW Megaproject ).

Some time ago, Sofyan Djalil made a harsher move. The National Development Planning Minister/ National Development Planning Agency (Bappenas ) Chief said that the government would not revise its development target for the 35,000 MW megaproject. This program has already been included in the 2019National Mid-Term Development Plan .

Sofyan said Bappenas had finalised the plan for this megaproject,and that the Energy Ministry would support the project by issuing regulations. “We will not revise it. If it is not executed, the technical issues are a matter for PLN,” said Sofyan on Monday (16/5). (Read: Government to Finance 9 Infrastructure Projects for IDR 33 T from Chinese Debt).

As a planning agency, Sofyan said Bappenas had executed its role, which was to source funding as needed. However, there were several cases where the funding was in place but the realisation and implementation of the projects had been delayed. “That would be the High Voltage Direct Current project or Sumatra-Java transmission project,” he said.