Financing Strategy for Indonesian Nuclear Power Project

Abstract

In anticipation of the introduction in the early 2000s of a nuclear power plant, the Government of Indonesia (GOI), through the National Atomic Energy Agency (BATAN), has formulated a Bid Invitation Specification (BIS) in parallel with the completion of the NPP Feasibility Study. This BIS formulation assumed an open international tender for the first unit of the NPP with project financing as a conventional loan. The GOI's recent policy is to minimize government financial support for power development. This paper summarizes a financing strategy for the Indonesian NPP project to make the NPP economically viable, and provides ageneral discussion on project financing using a conventional approach, Build-Own-Operate (BOO) and a counter-purchase approach. Innovative approaches for financing are still being pursued in order to obtain an optimum solution for investors and owners, to fulfill the Indonesian government's requirements.