Accelerating Energy Transition: PGE and PLN IP Continue Synergy for Optimal Utilization of Geothermal Energy

Jakarta, May 31, 2024 – PT Pertamina Geothermal Energy Tbk (PGE) (IDX: PGEO) and PT PLN Indonesia Power (PLN IP) have officially signed a Joint Development Agreement (JDA) in Jakarta on Thursday (30/5). This JDA marks a new phase in the joint effort to optimize the capacity of several Geothermal Power Plants (PLTP) in Indonesia.

Julfi Hadi, President Director of PT Pertamina Geothermal Energy Tbk, stated that this JDA is a strategic step to enhance synergy between two major domestic energy companies and is one of PGE's efforts to achieve the 1 GW installed capacity target.

"The signing of this JDA demonstrates our strong commitment to increasing the utilization of Indonesia's abundant geothermal resources to support the acceleration of the national energy transition, achieve the government's commitment to the Enhanced National Determined Contribution (NDC), and the Net Zero Emission program in Indonesia. We believe this cooperation will accelerate the development of more efficient and sustainable geothermal projects as one of PGE's strategic efforts to achieve 1 GW in the next two years," Julfi said.

This JDA follows the signing of the Joint Development Study Agreement (JDSA) by both companies on February 22, 2024. One of the main focuses of the JDA is the development of co-generation projects in two geothermal working areas by utilizing brine, or hot water from steam separation, to increase electricity production capacity. The initial target for the PLTP Co-Generation (Binary Plant) development is in the Ulubelu Binary Unit and Lahendong Binary Unit PLTP areas, potentially adding 30 MW and 15 MW of installed capacity, respectively.

Through advanced technology and innovative approaches, both companies hope to enhance the added value of geothermal resources and expedite the commercialization of these projects. Julfi Hadi mentioned that Co-Generation has the potential to increase PGE's installed capacity by up to 230 MW, which could significantly impact the efficiency of geothermal energy.

Julfi hopes that this partnership in the application of technology will become a key driver in accelerating the energy transition in Indonesia. "This JDA allows us to focus on increasing electricity capacity and accelerating geothermal energy development as part of the national energy transition strategy. By applying principles of operational excellence, we ensure that every stage from development to project operation is carried out efficiently and with the highest quality, thereby increasing the use of renewable energy," Julfi said.

Next, PGE and PLN IP are committed to completing the Power Purchase Agreement (PPA) quickly and efficiently to ensure that these projects can be built and operational soon, providing optimal benefits. The partnership between PGE and PLN IP is expected to become a model for similar collaborations in the future to accelerate the energy transition and support the national target for increasing the use of renewable energy.

"We hope this JDA can serve as an example for other renewable energy projects in Indonesia. With strong synergy and collaboration, we can achieve our goal of creating a more sustainable energy future," Julfi said.

Also present at the JDA signing was Norman Ginting, Project and Operations Director of Pertamina New & Renewable Energy (Pertamina NRE), who appreciated and hoped that this collaboration and synergy could continue. "Today, Pertamina through PGE and PLN through PLN IP have successfully signed a JDA as an important milestone for geothermal development. Pertamina NRE highly appreciates this step and hopes that in the future, these two important national energy SOEs can collaborate and synergize to drive more massive decarbonization," Norman said.

Vice President of Corporate Communication of PT Pertamina (Persero), Fadjar Djoko Santoso, revealed that Pertamina continues to develop geothermal energy by leveraging Indonesia's vast potential.

"Geothermal development is an effort to support the Government in achieving the national energy mix target and also Pertamina's effort in developing New Renewable Energy," Fadjar concluded.

The signing of this JDA is a significant milestone for the company's journey to support the energy transition in Indonesia. Through this strategic collaboration, PGE and PLN IP are determined to maximize the potential of geothermal energy, create economic value, and provide significant social and environmental benefits.

Further, PGE will continue to strengthen its commitment to becoming a world-class green energy company by upholding the principles of Environmental, Social, and Governance (ESG) in all its business and operational activities. According to the announcement on the Indonesia Stock Exchange (May 28), effective June 3, 2024, the company with the stock code PGEO will be included in the ESG Quality 45 KEHATI index, placing it as one of the 45 best stocks based on sustainability performance, financial quality, liquidity, and ESG implementation. This recognition is inseparable from various initiatives carried out in various PGE Geothermal Working Areas (WKP), such as community empowerment in PGE Area Ulubelu focused on social forestry, the flagship coffee program Canaya Geothermal Coffee in PGE Area Kamojang, and the Setor Jo program in PGE Area Lahendong, which processes waste into eco-enzymes and eco-bricks.

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PT Pertamina Geothermal Energy Tbk.

PT Pertamina Geothermal Energy Tbk (PGE) (IDX: PGEO) is part of the Subholding Power & New Renewable Energy (PNRE) of PT Pertamina (Persero) engaged in the exploration, exploitation, and production of geothermal energy. Currently, PGE manages 13 Geothermal Working Areas and 1 Assignment Working Area with an installed capacity of 1,877 MW, divided into 672.5 MW operated and managed directly by PGE and 1,205 MW under Joint Operation Contracts. The installed geothermal capacity in PGE's working areas contributes about 80% of the total installed geothermal capacity in Indonesia, with a potential CO2 emission reduction of approximately 9.7 million tons of CO2 per year.

As a world-class green energy company, PGE aims to create value by maximizing the end-to-end management of geothermal potential and its by-products and participating in national and global decarbonization agendas to support Indonesia's net zero emission target by 2060. PGE has excellent ESG credentials with 16 PROPER Gold awards from 2011 to 2023, in the highest environmental compliance awards from the Ministry of Environment and Forestry.