Feasibility Investment Analysis of Geothermal Project: A Case of Lumut Balai Geothermal Power Plant

Andri D. Setiawan, Dicky Nurachman, Marmelia P. Dewi, Irvanu Rahman

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

As the country with abundant geothermal energy resources, Indonesia has the opportunity to allocate geothermal as the leading renewable energy to substitute dependency on oil and gas. However, there are some challenges that developers faced in terms of technical, financial, and political challenges. Thus, making geothermal projects less attractive for investors to invest in this energy sector. Notably, the financial challenge that will be close attention for private sectors to tackle. Feasible financing is needed to tackle this issue to attract more investors. This paper aims to analyze the feasibility of a geothermal project in Lumut Balai geothermal power plant by formulating the optimal and efficient financial modeling and performing a probabilistic approach using Monte Carlo simulation. In this regard, the impact of feed-in-tariff will be assessed through three scenarios that will be simulated in the model. The results indicate that feed-in-tariff plays a significant role in determining the attractiveness of a geothermal project in Indonesia.

Original languageEnglish
Title of host publicationICIBE 2020 - 2020 6th International Conference on Industrial and Business Engineering
PublisherAssociation for Computing Machinery
Pages180-184
Number of pages5
ISBN (Electronic)9781450387880
DOIs
Publication statusPublished - 27 Sep 2020
Event6th International Conference on Industrial and Business Engineering, ICIBE 2020 - Macau, China
Duration: 27 Sep 202029 Sep 2020

Publication series

NameACM International Conference Proceeding Series

Conference

Conference6th International Conference on Industrial and Business Engineering, ICIBE 2020
CountryChina
CityMacau
Period27/09/2029/09/20

Keywords

  • Feasibility Investment Analysis
  • Feed-in-Tariff
  • Financial Modelling
  • Geothermal Energy

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