NUCLEAR POWER DEVELOPMENT IN INDONESIA

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1 NUCLEAR POWER DEVELOPMENT IN INDONESIA Soedyartomo Soentono National Atomic Energy Agency, Indonesia Abstract As a developing country, Indonesia has been fairly successful in her economic development. However, the country is facing a unique problem of supplying the fast growing energy demand to sustain the national long term development program. Various studies to introduce the utilization of nuclear power plants to generate electricity have been performed. The results of the studies show that during the second long term development program ( ), the optimum energy mix is to take place with the introduction of the nuclear power plants in the first decade of the 21st century. This is in accord with the national energy policy especially the diversification, conservation, and environmental protection. The nuclear activities in Indonesia have been favoring the introduction of the nuclear power plants and some pre-project activities have also been started taking also into account the private sector participation. Introduction Indonesia is an archipelago country being endowed with various energy resources such as coal, gas, oil, hydro, and geothermal. The energy resources, as well as the population, which has already reached 200 million people recently, however, are not evenly distributed among the islands. Jawa and its adjacent island of Bali, having land areas of only 15 % of the total area of the country and the least reserves of the energy resources, are inhibited by 65 % of the total population demanding about 80% of the electric energy consumption of the country. The oil and gas have been playing an important role in the Indonesian economy, together accounting for over 85 % of commercial net energy and about 30 % of the country's export revenues. However, unlike coal, other hydrocarbon reserves, especially oil, are not so abundant. As a developing country with significant economic growth of about 7 %/a, Indonesia has been fairly successful in controlling her inflation rate at less than 10 % for the last ten years. This has been the result of the Indonesian Long Term Development Program, i.e. the development of national economy through developing a more productive industry supported by a strong agriculture. It is expected that this development creates a strong basis for a self-sustaining growth in economy and other development sectors. The self-sustaining development has to be maintained by reliable sufficient supply of ever increasing demand of energy. The Outline of State

2 Policy gives emphasis on the importance for Indonesia's sustained economic and social development of meeting its rapidly growing energy needs efficiently, and of minimizing the adverse environmental and social impacts of energy use. Some key government policies are intensification, diversification, conservation, energy pricing, environmental protection, and private sector participation. Economic Development and Energy The energy sector is of importance in the development of the Indonesian economy which is categorized as a developing country with income per capita of US $ Indonesia's current per capita energy consumption is relatively low as compared to the one of other ASEAN countries. The increase in population, especially in the rural areas do not yet have adequate access to electric power. This is another indication of an expected high growth rate of electricity generation. Most energy resources are located outside the island of Jawa, yet Jawa, with its large population and industry constitutes the major area of energy demand. The government has adopted a policy of promoting development of these energy resources in a way which maximizes economic efficiency, provide regional development and employment opportunities. Oil had dual role of being the nation s prime source of commercial energy and of providing both foreign exchange and government revenue to finance economic development. By the late 1970's however, domestic consumption grew at an annual rate up to 15 %. Domestic consumption began to divert oil from the export market. In the late 1970's, the government embarked on an ambitious program to move domestic energy consumption away from crude oil in order to maximize the amount of oil production available for export. The indirect result of this diversification effort was the construction of electrical generation facilities utilizing non-oil energy sources such as coal. Cement plants were converted from burning oil to using coal. Diversification also led to increasing use of liquefied petroleum gas (from gas reserves) by household. There were also plans for increasing utilization of natural gas in domestic industry and for electricity generation. In the First Long Term Development Program (LTDP-I, ), energy was assumed to be abundantly available. During the LTDP-I the average primary energy consumption growth was 9.4 % annually. In the second LTDP ( ) it has been realized that energy resource availability become more and more limited, especially those of depletable resources. Indonesia will be a net oil importer in the LTDP-II, instead of an oil exporter. Therefore the role of oil, natural gas and coal will have to be directed to give optimal benefits to the country. It is predicted that in the LTDP-II the primary energy demand will grow at average of 7.2 % annually reaching the figure of more than 2.7 billion BOE by the year of The prediction was based on the macro economic projection, i.e. the GDP growth will decrease at the rates of 6.5 %, 6.00 %, and 5.00 % annually in the periods of , , and

3 respectively. The population growth will also decrease at the rates of 1.87%, 1.35%, and 0.85% annually in the periods of , , and respectively [1]. It is indeed important to note that the pattern of the final energy consumption during LTDP-I has changed. At the beginning of the LTDP-I, the pattern was % household sector (18.1 million BOE), % industrial sector (8.2 million BOE), and % transportation sector (12.1 million BOE). While at the end of the LTDP-I, the pattern changed to be 24.9 % household sector (60.30 million BOE), % industrial sector ( million BOE), and % transportation sector ( million BOE) [1]. It is also worth to note that during LTDP-I, the energy price was fixed below its economic price. In the future, LTDP-II, the price shall be formulated based on its economic value and taking into consideration its environmental cost. Energy Policy Briefly, the Indonesia National Energy Policy has four main objectives. These objectives are as follows : 1. Securing the continuity of energy supply for domestic use at prices affordable to the public, 2. Enhancing the life quality of the people, 3. Stimulating economic growth, and 4. Reserving an adequate supply of oil and gas for export to provide source of foreign exchange to fund the national development programs. To meet these objectives, the Government adopts three policy measures, i.e. : 1. Intensification : to increase and expand exploration of energy sources available in the country, 2. Diversification : to reduce dependence on only one type of fuel (i.e. oil), and later to replace it with other available fuels, and 3. Conservation : to economize energy production and utilization. Implementation of the energy policy covers several aspects such as issuance of regulations, standards, energy pricing incentives and disincentives, and the application of appropriate technologies. The technologies that have to be considered are identified as follows : 1. Technologies to produce substitutes for oil, e.g. gasification and liquefaction of coal, 2. Technologies to support a more sustainable energy supply, through the harnessing of the potential renewable sources, and 3. Clean and efficient energy technologies to support environmental program and sustainable development. 53

4 Taking into account all those described above, the introduction of nuclear power plants (NPPs) into Jawa-Bali electric system should be seriously considered, especially due to the fact that during LTDP-I the electricity consumption increased rapidly from 1,471,300 MWh in 1970/1971 to 38,962,035 MWh in 1993/1994 or equal to 15.1% annual consumption growth during this period. The installed capacity of electric power generation has considerably increased from 542 MWe at the beginning of LTDP-I to 21,989 MWe at the end of LTDP-1 [1]. To meet the rapid increase of domestic energy demand is becoming more difficult if it is only to depend on the existing resources. The selection of alternatives of energy supply for the optimum energy mix should be thought from various aspects, including the aspects of energy availability and security, technology, safety, social economic and environmental aspects. Reference should be made not only to the national energy policy but also the importance of the principle of complementarity and synergism in the development of optimal energy system since NPPs are not developed in vacuum but in a concerted efforts. Development of Nuclear Activities Being aware of the possibility of the utilization of nuclear energy for electric generation and the importance of buyers participation, the existence of well developed domestic infrastructure to support the introduction of NPP has been prepared stepwisely [2,3]. The basic law on the use of nuclear technology for peaceful purposes was passed in 1964, which is Decree No. 31 year 1964 concerning the main regulations for atomic energy. The law stipulates that Badan Tenaga Atom Nasional (BATAN), the National Atomic Energy Agency, is the highest implementing and supervisory agency in the use of nuclear technology in Indonesia. The Decree describes in detail of the intention to be at peace with other countries, and especially because nuclear science and technology can give possibilities to improve the lives of people, not only directly, such as in agriculture, medicine, and other fields, but also indirectly through electric power needed by various industries. It is further stipulated that BATAN shall have the duty to conduct researches and implement the use of nuclear technology for safety concern, health, and welfare of the people. As a follow up of the Decree, Government Regulation No. 33 was issued in 1965 for the formation of BATAN, an agency having the following duties and obligations : 1. To build facilities and develop nuclear technology in Indonesia, 2. To regulate and supervise the use of nuclear technology in Indonesia, 3. To prepare and increase the quality of experts in the nuclear field, and 4. To give general and scientific information concerning nuclear energy to the people. 54

5 Several nuclear research facilities are currently in operation in Jakarta, Bandung, Yogyakarta, and Serpong. These facilities have been in operation stepwisely and having strong links with various universities and laboratories within the country and abroad giving rise to the availability of experts and qualified domestic man power in various nuclear fields. Ever since 1980, BATAN has established a center for education and training implementing the man power development to prepare skilled and high quality personnel to handle the NPP program in every phase. This is further supported by establishing a school for nuclear techniques and expertise in Yogyakarta, co-operation with the International Atomic Energy Agency (IAEA) and educational institutions and universities, such as the Bandung Institute of Technology, the University of Indonesia, and the University of Gadjah Mada. Co-operation with research as well as relevant institutes having nuclear science and technology activities in develop countries has also been put on a firm foundation. The nuclear Science and Technology Base (STB), i.e. the nuclear research facilities, especially the one at the Serpong area, is well equipped with sophisticated hardware, and can be utilized beneficially in the NPP technology research and development activities. This STB consists of a General Atomic s Siwabessy multipurpose research reactor and its supporting laboratories [3]. The maximum thermal power of the reactor is 30 MW and the average thermal neutron flux is 2 x neutron/cm 2 sec., a neutron flux which is comparable to the one of power reactor. The activities implemented by BATAN in the research and development of NPP technology has been done through the STB with the aim to master: designing, manufacturing, building, and the safe, reliable and economical operation of NPP. This STB is also able to be utilized for developing advanced nuclear technology through research and development activities covering : 1. Reactor technology and components irradiation testing, 2. Development of technology and production of research and power reactor fuel elements, and post irradiation examination, 3. Development of nuclear components designing skills and their production, including the quality control and quality assurance programs, 4. NPP safety technology, nuclear protection design system, components testing, corrosion testing, and thermal hydraulic testing, 5. Process technology for radioactive wastes with the aim to assure safety to the people and environment, 6. Maintaining a data base for nuclear information including software and hardware for analysis of various nuclear technology processes, and 7. Engineering, an activity which has started from the development of the isotope production reactor. 55

6 Through the pre-project and project implementation of the STB sufficient experience have already been gained in various areas by BATAN personnel, local engineering companies, contractors, and regulatory body. In the near future, the supervisory and regulatory activities are to be enhanced and promoted by disengaging the Atomic Control Bureau from BATAN organization. This is in accord with the necessity of separation between regulatory and promotion bodies. The Atomic Control Bureau is to become a more independent body, to be called the Nuclear Regulatory Agency (NRA). This NRA shall have the functions of regulatory, licensing and inspection in the nuclear field. This is in line with the requirement of an independent regulatory body needed to establish if NPPs are to be introduced. The draft of a new basic law on the use of nuclear energy for peaceful purposes covering, among others, this separation, has been scrutinized by the Indonesian parliament (Council for People Representative) and expected to be issued in the near future. Taking into account the results of various feasibility studies, the establishment of an authority for the construction and operation of the NPP in Indonesia is now becoming more apparent for the safe and efficient operation of the NPPs. This authority is still under considerations by the government. BATAN, as a governmental research institute is able to give technology support through the use of the existing research reactors, fuel element, waste management and engineering safety facilities. In the mean time, prior to the establishment of the NPP authority, BATAN is at present involved in the formulation and planning [4]. Realizing the importance of public acceptance on the peaceful uses of nuclear technology especially the introduction of NPP, an interdepartmental organization has been established since This organization, coordinated by BATAN, has made efforts in promoting, giving information, and discussing openly to the public on the peaceful uses of nuclear energy and especially to the immediate environment where the feasibility site studies are being conducted. An effort such as these will be a continuing program, as also practiced by many other countries. Studies of the Nuclear Power Plant Introduction Feasibility studies of the introduction of the NPP in Indonesia have been conducted since the end of 70s. The first pre-feasibility study for the introduction of a NPP was conducted in with the assistance of the government of Italy. However, following this study the government deferred the decision until the STB in Serpong became fully operational. In 1985 work began on updating the studies with the assistance of IAEA, the US government (through the services of Bechtel International), the French government (through the services of Sofratome), and the Italian government (through the services of CESEN). These updated reports, and the analytical capabilities developed by the Indonesian partners during the process of these co-operations, have become the foundation for the present planning activities. Recent pro- 56

7 jection using WASP, a computer software for planning electricity expansion, have shown that introducing nuclear power by 2000 would be an attractive option [5]. Another study (Markal Study) coordinated by the Agency of Assessment and Application of Technology has clearly shown that if discount rates of 4% to 8% were used, nuclear would become the best option starting from the eighth Five Year Development Plan ( ). This means that the decision to embark on a nuclear power program should be made imminent, considering that it would require a tenyear lead time. The site for the first NPP has long been studied since In conclusion, the Muria peninsula region has been selected to be the most suitable area in Jawa. The plan for a final site investigation has long been prepared. It consists of a selection and evaluation of the preferred site. In September 1989, the Indonesian Government through the National Energy Co-ordination Board decided to perform anew the NPP feasibility study including a comprehensive investigation of the Muria peninsula as a candidate site for NPPs. The study itself had to be carried out by BATAN under the directives of the Energy Technical Committee of the Department of Mines and Energy, involving also relevant institutions. On August 23, 1991, an agreement was signed in Jakarta between the Ministry of Finance and BATAN on behalf of the Government of Indonesia, and a consulting company, namely NEWJEC Inc. This agreement contracted NEWJEC Inc for a four and a half year period to perform a site selection and evaluation, as well as a comprehensive NPP feasibility study. The principal part of the contract value was spent on studies related to the site, being located in the northern coast of the Muria peninsula in Central Jawa. The scope of the feasibility study included two main components, i.e. 1. The non-site studies, covering, among other things, energy economics and financing, technical and safety aspects, the fuel cycle and waste management, and general management aspects, and 2. Site and environmental studies, covering field investigations and assessment of site selection, site qualification/evaluation, and environmental, socio-economic and socio-cultural impacts. Each part of the study included a technical transfer and training for the Indonesian counterpart. The feasibility study was carried out based on the comprehensive quality assurance program developed by NEWJEC Inc. to comply with IAEA recommendations, and approved by BATAN. The official Starting Date of this project was then announced to be November 22, The quality assurance program, as one of the prerequisite provisions, had been duly submitted by the consultant and approved by BATAN. On December 30, 1993, two years after the starting date, the NEWJEC Inc submitted the feasibility study report and preliminary site data report to BATAN. The general conclusion was as follows 57

8 1. There is no hindrance in integrating either 900 MWe or 600 MWe NPP into Jawa- Bali grid system in early 2000s 2. Generation cost of 600 MWe NPP is competitive to that of similar size of coal-fired plant using de-sox and de-nox equipment, 3. The conventional financing scheme is capable of producing electricity at a cheaper cost than both build, operate and own (BOO) and build, operate and transfer (BOT) financing scheme 4. Practically, every type of reactor, PWR, BWR, and PHWR, with proven technology can be appropriately constructed in Indonesia 5. Open fuel cycle, direct disposal of spent fuel, should be selected at least two decades after the operation of the first NPP as the current Indonesian strategy 6. Ujung Lemahabang is the best candidate site for the first NPP, with Ujung Grenggengan and Ujung Watu as the first and the second alternative site respectively [6]. On May 1996, about four and half years after the starting date (22 November 1991), the feasibility study was completed. NEWJEC Inc. submitted the Final Feasibility Study Report, Final Report on Site and Environmental Study, Preliminary Safety Analysis Report, and Environmental Impact Analysis Report. Quality assurance program for the feasibility study had been consistently implemented through out the project duration. Recommendations resulting from reviews by an independent consultant had been followed up and integrated into the final report of the feasibility study. The followings are some general points derived from the reports : 1. The introduction of NPPs in the early 2000s to Jawa-Bali electric system represents an optimal solution. The role of NPPs is clearly to stabilize the supply of electricity, conserves strategic oil and gas resources and protects the environment from deleterious pollutants 2. Ujung Lemahabang, an area of approximately 500 hectares at the tip of the Muria peninsula at the north coast of central Jawa has appeared to be the best candidate sites for the NPP from both technical and economical point of view. There is no immediate hazard that could affect the NPP integrity and its operation. Some of the important data obtained from this study regarding the forecasted primary energy supply during LTDP-II are listed in Table I [1]. Pre-project Activities Indirectly, some of the nuclear activities performed are in support to the preproject activities, namely the knowledge absorbed and experience gained during the pre-project and project implementation of the STB. Other activities such R & D closely relating to the NPPs as well as enhancement of the Atomic Control Bureau toward 58

9 NRA and NPP authority establishment are also favoring the NPP introduction. Further more the routine activities of the public information regarding the peaceful uses of nuclear energy, especially to the immediate environment of the NPP candidate sites are indeed of important steps. Table 1 Forecasted Primary Energy Supply (million BOE), LTDP-II Oil , , , [56.54%] [55.6%] [54.5%] [48.1%] [36.9%] (Dom. prod.) (Import) (Export) Gas [31.56%] [27.6%] [23.8%] [22.9%] [15.5%] Export Coal , [9.50%] [13.6%] [16.11%] [22.27] [38.01%] Export Hydro [1.32%] [2.1%] [2.2%] [2.1] [1.7%] Geothermal [0.28%] [1.1%] [2.2%] [1.9%] [1.5%] Nuclear [0%] [0%] [1.3%] [2.8%] [6.3%] [ %] = % of each energy sector supply to the total forecasted primary energy supply Following the completion of the studies, bid invitation specifications (BIS) are being performed with the assistance of international consultants for prospective nuclear power plants. A BIS for turn-key contract and a conventional financing scheme has been formulated. Moreover, in line with the government policy to increase the private participation [7,8], especially the private investors as independent power producers to build, own, and operate (BOO) all types of electricity supply project, the 59

10 BIS for NPP on BOO basis is being performed. Another financing scheme, i.e. barter (counter trade) for the introduction of the NPP is also being considered. Conclusions Indonesia is a developing country with large population and is bestowed with various energy resources although not so abundant, except coal, facing a unique energy supply problem to sustain her economic growth. Even though Indonesia has some oil and gas resources that had been used, especially oil, in the past to grow the country economy, it has to be realized that these resources are not unlimited. The introduction of the NPPs will not only be to reach an optimum energy mix based on cost and environment, but also to relieve the pressure arising from increasing domestic demand for oil and gas. The oil and gas will then be able to be used for other purposes, such as export, transportation, and feedstocks to support the LTDP-II. This is an integral part of the overall energy policy. The nuclear activities in Indonesia have been favoring the introduction of the NPPs and some pre-project activities have been started. The private sector participation in the project implementation of the NPPs and its utilization is also to be taken into consideration. References 1. I. Subki, and Adiwardoyo, The Position of Nuclear Power in Indonesian Optimal Energy Mix, Proc. 10th Pacific Basin Nuclear Conference, Kobe, Japan, Oct , S. Soentono and B. Arbie, Role of Research Reactors for Nuclear Power Programme in Indonesia, Proc. 9th Pacific Basin Nuclear Conference, Sydney, Australia, May 1-6, S. Supadi, S. Soentono, and M. Djokolelono, Contribution of BATAN's Multipurpose Reactor and Its Supporting Laboratoria to the Nuclear Programme in Indonesia, IAEA, Athens, IAEA-SM-291/20, D. Ahimsa, Nuclear Programme in Indonesia, The 9th KAIF/KNS Annual Conference, Seoul, Korea, April 6-8, I. Subki, A. Iskandar, and S. Supadi, Recent Progress in the Feasibility Study for the First Nuclear Power Plant in Indonesia, Proc. 9th Pacific Basin Nuclear Conference, Sydney, Australia, May 1-6, B. J. Habibie, Nuclear Power Development in the Asia Region, 28th Annual Conf, JAIF, Tokyo, April 10-12, I. Subki, Adiwardoyo, and M. Djokolelono, Nuclear Energy Prospects in Indonesia: Requirements for Safe, Reliable and Economic Alternative, 8th International Conference on Emerging Nuclear Energy Systems, ICENES'96, Obninsk, Russia, June 24-28,

11 8. B. Sudjana, Indonesian Need on Energy, TELSTRA, Strategic Review, Ikatan Alumni Lemhannas Bilingual Magazine, No. 42, Jakarta, Indonesia, September- October