Supporting Indonesia’s Energy Transition
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The GECS project aims to finance the construction of a high-voltage transmission backbone in Sulawesi, connecting the green electricity production centres to the consumption centres around Makassar and Palopo.
Background
Sulawesi has great potential for the generation of energy from renewable sources (RE), especially from hydropower, but also wind. At the same time, Sulawesi is considered one of the regions with the highest economic growth rates and an increasing demand (e.g. from nickel production) requires the addition of new power plants. While renewable energy is being promoted in the region, the major challenge is its dependence on transmission and distribution networks to reach private consumers and value-adding sectors.
Green electricity – especially from hydropower in the north of South Sulawesi province, which must be transported to the consumption centres around Makassar and Palopo – faces transport challenges, as hydropower plants are often located far from the existing grid, whose capacity to transport or absorb additional renewable energy remains limited. To efficiently evacuate their energy potential and increase grid stability, it is crucial to establish a high-voltage transmission backbone. Only after completion and commissioning of GECS can a significant contribution be made to expanding the RE supply, improving the climate friendliness of the Indonesian electricity supply and meeting the strong growth of electricity demand in South Sulawesi.
The accelerated expansion of renewable energies (RE) and the power grid in Sulawesi plays a central role, not least against the background of the Indonesian government’s updated 10-year expansion plan (RUPTL 2021-2030). The GECS project is prioritized in this plan.
Objective
- Expansion of power grid infrastructure on Sulawesi (Indonesia) through the construction of transmission lines and substations
- Energy-efficient connection of generation capacities from renewable energies
- Contribution to the Just Energy Transition Partnership Indonesia
- Reduction of energy loss
Key project aspects
- Total project cost: EUR 680 Mio. (out of which KfW plans to finance 300 Mio. EUR)
- Transmission length: 400 km (Bakaru – Palopo – Sidrap – Daya Baru – Banteaeng)
- Current status: under preparation of the feasibility study, Environmental and Social scoping as well as internal credit approval process within PLN and KfW. Contract is expected to be signed in 2025.
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