1. FiT Solar Auctions in Indonesia Lessons Learned from Participation of a Local EPC Company German-Indonesia Business Forum on Grid-Connected PV Systems Intercontinental Jakarta MidPlaza Hotel
Erik C. Sentosa – Director
PT. Suntech Solar System

2. List of Contents Brief Company Introduction
Conditions of Solar Auctions
Auctions Progress
Lessons Learned
Summary & Recommendations
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

3. Brief Company Introduction
PT. Suntech Solar System established in 2007
EPC Company for RE, specializing in PV (On-Grid, Off-Grid and Hybrid Systems)
Authorized Distributor & Partner in Indonesia for SMA and Suntech Power
Emphasis on technical expertise, detailed engineering, know-how, quality components and good installation
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

4. Conditions of Solar Auctions
Regions and system sizes defined by Ministry of Energy and Mineral Resources (ESDM)
Auctions held by Directorate General of New & Renewable Energy and Energy Conservation (EBTKE)
Total quota 140MW for 80 locations (regions) with sizes 1 to 6 MW
Ceiling Tariff : USD0.25/kWh for imported modules, USD0.30 for modules with local content >= 40%
PPA with PT. Perusahaan Listrik Negara (PLN) for 20 years without price adjustments
Bid language: Bahasa Indonesia
Auction open for state-owned enterprises , local goverment-owned enterprises, private Indonesian enterprises and bidding consortia
International companies via Project Joint Operation (KSO), JV or Consortium with private or state-owned enterprises in Indonesia
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

5. Conditions of Solar Auctions (Cont’d)
Online auction: register to
Download tender documents, Q&A sessions, upload of bid documents, evaluation progress & reasons
Tender documents: 120+ pages, fortunately most are identical for all locations
Contents: Administrative, Technical, Financial, Draft of PPA
Bid evaluation (elimination): Administrative -> Technical -> Financial -> Bid Price
Bid Bond 2% and Escrow Account 20% of overall project price
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

6. Conditions of Solar Auctions (Cont’d)
Tender Download – Upload of Bid: 14 days preparation
Bid Evaluation – Winner Announcement: 2-3 weeks
Make Escrow Account: 15 days after announcement
PPA Signing – Grid Interconnection Study: 60 days after announcement
Financial Close: within 3 months after PPA
Installation - COD: latest 18 months after PPA
Example
Bid Price
Evaluation
Local Modules
Import Modules
Company A
USD0.24
Company B
USD0.25
USD0.20
Company C
USD0.21
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

7. Conditions of Solar Auctions (Cont’d)
Purchase price includes all cost of generation to point of grid interconnection
Purchase price are including VAT (PPN) 10%
Payment in IDR with exchange rate valid on the time of payment
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

8. Auction Progress First tender started beginning November 2013
So far total of 11 locations (19.5MW) tendered
4 locations (4.5MW) out of 11 failed due to tender conditions are not met by participants
Lowest Bid Price: cents US per kWh with imported modules
Last tender announced on March 2014, currently FiT solar auction program is under evaluation before more locations are to be tendered
No information when more locations are to be tendered
70 (+4) locations with volume of 120.5(+4.5)MW are still to be tendered
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

9. Lessons Learned Exact locations are not defined by ESDM
Insufficient coordination between ESDM-PLN-Local Government
GPS coordinates are required in bid document, no alternate location
Bid document requires land availability
Limited preparation time for complete bid documentations
Slightest error in bid documents will result in elimination
Insufficient or no data for grid conditions
Grid capacity only based on computer model simulation, different from actual at site survey
Grid connected PV capacity >20% of grid capacity -> prone to grid failure
Therefore, advanced region choosing - site survey - bid preparation needs to be done prior to tender announcement
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

10. Summary Site Survey after region choosing:
Coordinate with local ESDM – PLN – Local Govt – Local Land Authority for suitable sites
Make sure of land ownership (certificate) & price, not part of protected forest or conflicting with land allocation
Close distance to PLN Grid or Substation
Site is disaster-free (flooding, tsunami, landslides, etc.)
Site survey for grid conditions (load, capacity, future grid expansions)
Transport facility, access to site, handling facility, closest seaport & airport to site
Continue to bid preparation before tender announcement
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

11. Reccomendations
Improve coordination between ESDM – PLN – Local Goverment – Local Land Authority to define suitable or “perfect” sites and set the land prices at a reasonable predetermined prices for the auction winners to reimburse
This would avoid a lot of uncertainties and unnecessary efforts, save time and money
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System

12. Thank You
Vice-Minister of ESDM and Director General of EBTKE once said “..IPP investors are like heroes and pioneers..”
Let’s become heroes together and for each other..
Dipl.-Ing. Erik Chandra Sentosa
Director – PT. Suntech Solar System
5 May 2014
Lessons Learned from Participation of FiT Solar Auctions in Indonesia – PT Suntech Solar System