Asahan No. 3 Hydroelectric Power Plant

One project providing reliable renewable energy capacity alongside a big local impact on the communities around it.

Despite the rapid rise of solar and wind power in recent years, the most widespread global renewable energy capacity remains hydro-electric power. With a guaranteed water resource, the newest Asahan plant in Indonesia strengthens Sumatera Island’s reliable clean energy prospects.

Growth in solar and wind power presents an intermittency challenge that every energy grid needs to tackle. In Indonesia, the role of hydropower in meeting that challenge is growing thanks to the rapid response built into the new Asahan plant to allow it to buffer against intermittency of other energy sources.

This kind of investment is crucial to Indonesia’s energy strategy, which aims for 23% of the country’s energy to be renewable by 2025. So with a guaranteed water resource, the new run-of-river hydroelectric plant will work in combination with two other plants on the river, providing an additional 1,218GWh of clean energy.

This will help the island of Sumatera avoid blackouts caused by large disturbances to other energy supplies, which will have a big impact on the local community.

Local economic impact
Along with the impact on the wider energy grid, the project has been designed to provide direct employment opportunities not only in construction but in management of the facility once complete. To support that, education and skills programmes were set up at the start of the project to support local people into valuable roles.

At the same time, the work underway to capitalise on the new reliable energy supply will see it become a benchmark for the economic impact of hydropower investment.

International standards
As a state-owned enterprise, PT PLN(Persero) is leading the programme. This includes planning, implementation and evaluation of the licensing process, land acquisition, supervision of construction contracts, and supervision of electricity infrastructure construction.

PT PLN has made a concerted effort to engage in international standards for this, to ensure the best possible outcomes. In particular, it has used on this project, the FIDIC suite of contracts that have been adopted by all of the major multilateral development banks involved in financing international infrastructure projects.