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24 July 2018

Indonesia’s first wind power project officially inaugurated

Sidrap wind farm, Indonesia’s first commercial-scale wind project, has been officially inaugurated by the country’s president Joko Widodo. Mott MacDonald is lenders’ technical, environmental and social advisor to the Overseas Private Investment Corporation (OPIC) and Sumitomo Mitsui Banking Corporation (SMBC) on the scheme and will now monitor operations in an ongoing role.

Located in South Sulawesi, the 75MW wind farm will help the Government of Indonesia achieve its target of a 23% renewable energy contribution to the country’s electricity production by 2020. The scheme is capable of powering up to 70,000 households annually.

Mott MacDonald has been involved in the Sidrap project since 2015. The consultancy helped OPIC and SMBC achieve financial close for the scheme by performing a holistic due diligence to identify any potential completion or operational risks. This included assessing the technical capabilities of each of the project’s stakeholders and reviewing its schedule, agreements and financial model. Mott MacDonald also provided construction monitoring services, including the installation of 30 Gamesa wind turbine generators which were positioned along three ridges on a relatively complex site.

Robin Ingram, Mott MacDonald’s project manager, said: “Our wind expertise and lessons learned from first of a kind projects worldwide helped Sidrap’s lenders be comfortable to finance the scheme in Indonesia’s relatively new wind market. We helped them to understand contractor capabilities in this emerging market and to navigate power purchase agreement complexities, which are often encountered by countries in the early phases of renewable energy adoption.”

“Indonesia has fantastic potential for various sources of renewable energy, such as wind, geothermal and solar. In fact, another wind farm is already under construction in South Sulawesi which we are also advising the lenders on, while the wind power development pipeline is generally growing across the country,” Robin added.

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