Indonesia: Java-Bali 500-Kilovolt Power Transmission Crossing

Energy / Electricity transmission and distribution

Power shortage has been a critical infrastructure bottleneck throughout the country and fast track generation programs are being implemented to improve the power generation capacity. However transmission and distribution system has limited capacity to transmit additional power. Hence the transmission and distribution networks need to be developed in a coordinated manner to realize the benefits of the new generation capacities and to provide access to un-electrified areas.

Bali is Indonesia's top tourism showpiece. However, the Bali power system suffers from frequent outages and blackouts due to low generation reserve margin and transmission bottlenecks. Transmission of power from East Java to Bali at 500 kV level has been determined as the best option to improve the power supply in Bali based on power system studies and is included in PLN's power development plan. As the power demand in Bali is only about 2.5% of the total demand of the Java-Bali power grid, by coupling it with more efficient generation capacity in Java, this option is considered the most technically and economically feasible option than installing new generation in Bali. The project is an outcome of PLN's least-cost generation expansion plan and long-term transmission development plan.

The project will strengthen the power transmission system by connecting Bali with a 500 kV link to Java, thus facilitating efficient utilization of existing and planned power generation plants in Java. This would enable transmitting comparatively cheaper power to Bali from the large power plants in East Java. Currently PLN relies mainly on expensive diesel-based generation to supply electricity in Bali and the proposed transmission line will reduce operational expenditures which will also reduce the subsidy payments made to PLN by the government. PLN's investment in the project is also part of its nationwide plan to increase electrification. The upgrading of the 150/20 kV substations under the project along the proposed route of the transmission line also ensures provision of electricity among the local rural communities in the project area.

Development of 500 kV transmission networks

Development of 500/150 and 150/20 kV substations

Project management

The project is classified as environmental category A, the highest environment impact categorization based on the ADB Safeguard Policy Statement 2009 (SPS). This is because the project is associated with two national parks. Broad based assessment of the project s environmental impacts has been carried out for all project components including associated facilities in accordance with the ADB Safeguards Policy. Relevant Indonesian environmental policies, regulations and guidelines were also considered in the preparation of the Environmental Impact Assessment (EIA) by PLN in coordination with ADB. Due consideration was given to environmental issues during the analysis of the interconnection options and selection of final alignment of the transmission line and sites for the two associated substations. Studies were carried out to avoid adverse impacts on (i) Baluran and Bali Barat National Parks which are protected areas; (ii) cultural sites, such as temples and mosques; (iii) physical displacement of people; (iv) public health hazards; and (v) land use. The environmental assessments concluded that most project impacts are short term during construction phase and can be effectively mitigated during implementation by adopting proper measures and procedures. The operational phase impacts are very minimal and a comprehensive package of environmental mitigation and offset measures has been designed to support biodiversity conservation in the two national parks. EIA has been uploaded on ADB website. The Environment Management Plan (EMP) of the EIA forms part of the bidding documents and PLN will administer both the construction contracts and the EMP implementation. PLN will submit regular implementation progress reports and monitoring reports to ADB for review. Project implementation consultants (PIC) has been engaged to assist PLN in the implementation and monitoring. In addition to the PICs an independent monitoring consultant will be engaged for independent monitoring in each quarter. A grievance redress mechanism has been developed to receive concerns of the affected people / entities about the project s environmental performance and facilitate resolution. PLN s project management unit, project implementation units, contractors, and park authorities will be trained on all aspects of the EMP. Based on the review mission in April 2016, biodiversity study was updated based on which supplementary Environment Impact Assessment (EIA) was prepared based on site-specific impact assessment focusing on the latest biodiversity condition. This is related to the component 3 (crossing towers), funded by KfW.

Loan for 500kV transmission line and substation has been partially cancelled. However, ADB continue implementing a small-scale capacity building technical assistance for the institutional strengthening of the park authorities in the operational management, implementation of long-term conservation measures and monitoring of the implementation of EMP activities in the two national parks.

Project Implementation Consultants and Capacity Building (AWARDED)

Independent safeguards monitoring consultants

Estimated budget $0.457 million

International Competitive Bidding

Package 1, Lot 1, Transmission Lines, estimated cost $79.9 million

Package 1, Lot 2, Transmission Lines, estimated cost, $49.5 million

Package 2, Lot 1, Extension of Paiton Substation, estimated cost, $27.1million

Package 2, Lot 2, New Antosari Substation, estimated cost, $49.7 million

Package 3, Upgrading of 150/20 kV Substations (AWARDED)