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Sembcorp terminates 2021 agreement to develop Indonesia solar and energy storage project

Jovi Ho
·2-min read

Earlier this month, leaders from Singapore and Indonesia signed an MOU to develop renewable energy generation projects there.

Sembcorp Industries U96 has terminated a joint development agreement (JDA) from October 2021 with Indonesia’s with PT PLN Batam and PT Trisurya Mitra Bersama to develop a large-scale integrated solar and energy storage project there.

In a March 27 press release, Sembcorp says all parties have mutually agreed to terminate the JDA, which was announced on Oct 25, 2021.

Under the agreement, the companies had detailed plans to develop a large-scale integrated solar and energy storage project in Indonesia’s Batam, Bintan and Karimun (BBK) region.

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The project had been expected to support some 1,000 direct and indirect jobs in Indonesia and Singapore during its construction phase.

The scrapped project had a planned solar power generation capability of around 1 gigawatt-peak (GWp), with the renewable power generated to supply the clean energy needs of the local communities. The plans had also raised the opportunity of renewable energy export to Singapore via subsea cables.

“Sembcorp remains committed to supporting Asean's energy transition with reliable clean energy supply,” reads the March 27 press release. “The company continues to develop, and is engaged in a number of initiatives, to import energy from the region.”

According to Sembcorp, the termination of the JDA is not expected to have any material impact on the earnings per share and net tangible assets per share of Sembcorp for the financial year ending Dec 31, 2023.

Earlier this month, leaders from Singapore and Indonesia signed a memorandum of understanding (MOU) to develop renewable energy generation projects in Indonesia, both for domestic needs and for export to Singapore.

Known as the Green Corridor Project, it will attract an estimated $50 billion of foreign direct investments to Indonesia, reducing the country’s national determined contributions (NDCs), and transferring renewable energy knowledge and skills into Indonesia.

According to the Sustainable Energy Association of Singapore (SEAS), the Green Corridor plan is to develop a green manufacturing industry, creating "tens of thousands" of green jobs for Indonesians.

Members of SEAS and multiple partners working to develop the Green Corridor project include AirCarbon Exchange, Climate Resources Exchange, Durapower Batteries, EDPR Sunseap, ET Solar, Haitai Solar, Huawei, Keppel, Meike Solar, Seraphim Solar, Narada Batteries, Gotion Batteries, SERIS, Sungrow, Vanda RE (a joint venture between Gurin Energy and Gentari) and VFlowTech Batteries.

Shares in Sembcorp Industries closed 6 cents higher, or 1.42% up, at $4.30 on March 27.

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