The challenge of supplying power across an archipelago of more than 17,000 islands is complicating Indonesia’s goal of getting more out of its scattered mineral resources.
While almost 80 percent of Indonesia’s electricity capacity is in the islands of Java and Bali, the majority of its most abundant minerals such as bauxite and nickel are found in provinces including Sulawesi, Halmahera and Kalimantan. That’s testing PT Perusahaan Listrik Negara, the state utility, which received requests from 25 companies to supply new mineral-processing plants with power as of last month.
“The problem is smelters are often located in remote areas where power stations and infrastructure are lacking,” Jarman, the director general of electricity at the energy and mineral ministry, said in an interview in Jakarta.
Indonesia, the biggest producer of mined nickel, banned mineral ore exports in January to boost investment in the smelters and refineries needed to process raw materials locally into higher-value commodities. By 2030, the plants needed to turn the nation’s ore into metals will require additional power equivalent to 13 percent of current capacity, putting a strain on the electricity network in Southeast Asia’s largest economy.