Potential for Floating Solar in Indonesia: A quick-look Assessment - October 2017

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Potential for Floating Solar in Indonesia: A quick-look Assessment - October 2017 Representative view 40 MW floating solar on abandoned coal mining site in Anhui Province, PRC; this is the largest known floating solar PV installation in the world as of September 2017, Photo credit: ChinaDaily.com

Floating & other non-conventional locations for Solar PV in Indonesia Non-conventional solar locations include: Existing Hydro Reservoirs Lakes Estuaries of large rivers Coastal Bays Potential for several GW at these types of sites -- these notes show indicative aggregate capacity of 975 MW at 6 sites Marine floating solar potential is effectively unlimited in Indonesia; LCOE < diesel, based on limited commercial deployment and operational experience, e.g., Swimsol in Maldives http://swimsol.com/#lagoon

Floating PV Systems: the basics Major benefits Natural cooling from the water increases PV energy yield (vs. 10% penalty at some tropical sites, e.g., ground-mounted in Cambodia) Floating systems contribute to reducing water evaporation improves climate resilience of river basin with indirect benefits to and no competition with agriculture Fast deployment: over 1,000 MW per year installation rates are logistically feasible Scalable: can be built in stages to match demand growth Modular: build in stages to minimize initial capital and overall financing risks 3

Floating Solar Power Plant Layout (elevation view) Source: International Journal of Current Research and Modern Education (IJCRME) ISSN (Online): 2455 5428 & Impact Factor: 3.165 Special Issue, NCFTCCPS - 2016 4

Floating Solar PV Systems Installations United Kingdom: Japan: 6.3 MW on a water reservoir in London (Thames Water) 2.3 MW, Kasai City, Japan Singapore: http://news.nus.edu.sg/highlights/11022-floating-solar-panels-make-waves World s largest testing center for floating solar PV systems is a collaborative effort of Singapore s Economic Development Board (EDB), Public Utilities Board (PUB) and Solar Energy Research Institute of Singapore (SERIS) 5

Hybrid Hydro-Solar Energy Systems A Hybrid Energy System consists of two or more renewable energy sources used together to provide increased system efficiency, and greater balance in energy supply. In a Hydro-Solar Hybrid Energy System, hydroelectric power is integrated with solar PV installed on floating structures in an existing reservoir. Key advantages include: 1. Increased power capacity and energy output with same footprint power density is increased; water flow can be reduced as solar ramps up 2. Hydropower generation s quick ramping serves as energy storage to balance variable solar output 3. Floating solar marginally reduces water evaporation 4. Existing transmission lines can be upgraded if necessary at lower cost than greenfield transmission capacity

Typical load and production profiles for Hydro+Solar 7

Water Use Efficiency: Synergy of Hydro-Solar Combination Total energy delivered from the original hydro plant can be enhanced significantly by adding the floating solar on the reservoir surface Typical hydro designs are based on 50% plant load factor, e.g., 100 MW project produces 438,000 MWh per year Solar PV plant load factor is typically 15-20%, e.g., a 100 MW PV plant produces 131,400 175,200 MWh per year up to 40% of a 100 MW hydro plant output Some hydro plants have greatly reduced output during dry season Since annual water flow through a hydro system is the rate-limiting factor for energy output (MWh), a co-located solar component will allow increased dispatch-able energy production, making full use of existing grid connection(s)

Considerations for Floating Solar Hypothetical 100 MW project of floating solar PV requires: 1. $105 million estimated investment Installed capacity assumed to require 2 hectare / MW (0.5 MW / hectare) 1 km x 1 km area required for 50 MW capacity 2. Based on a moderate solar irradiance zone Minimal environmental or social impacts based on current deployments (limited publications available) Indicative sites shown in these notes show different fractions of reservoir or water body used; general rule of thumb is 1-2% of available water surface for floating solar Floating solar will not displace people or submerge land Floating solar will reduce evaporation

Cost Estimate for 100 MW system Cost for 100 MW [US$ million] US$/W* Module 34.0 0.34 Inverter 9.0 0.09 Electrical work 19.6 0.20 Total PV equipment 62.6 0.63 Floating structure 16.9 0.17 Anchoring 4.2 0.04 Total floating PV 83.7 0.84 Grid connection cost - - Infrastructure 21.0 0.21 Total investment cost 1,04.7 1.05 Based on these assumption and the available solar resources, the cost of solar electricity would be in the range of: US$ 0.075 / kwh Note: NOT including subsidized or concessional financing opportunities Based on estimates prepared for Sambor Hydropower reservoir site in Cambodia 10

Insolation > 1800 kwh/m 2 / y in Kalimantan & Sulawesi Picture source: SolarGIS, Irradiance source: Meteonorm 11

Site 1: Riam Kanan hydropower, South Kalimantan Riam Kanan hydroelectric power project east of Banjarmasin Initial operations began in 1973 Installed electric capacity of 30 MW (3 x 10 MW) 42 meters net head, 87 m3/sec design discharge, 103 GWh/year 80 km2 (8000 hectares) Key assumptions: 2 hectares/mw PV Using maximum 2% of reservoir area to minimize potential environmental and social impacts ~ 80 MW If no area constraints, < 7% of reservoir area will support 4 x 50 MW units + 6 x 12.5 MW = 275 MW Opportunity for major overhaul of hydro-generation? Storage may be required if solar capacity is much larger than hydro capacity Opportunity to deploy prototype electric/hybrid tourist boats?

Riam Kanan 30 MW hydropower plant east of Banjarmasin, South Kalimantan Banjarmasin Riam Kanan dam & powerhouse

Riam Kanan: < 2% of reservoir area, 6 x 12.5 MW units = 75 MW Dam & powerhouse

Riam Kanan: no area constraints 4 x 50 MW units + 6 x 12.5 MW units = 275 MW Dam & powerhouse

Powerhouse Site 2: Pamona 2 hydro, C. Sulawesi Pamona 2: 195 MW (3 x 65 MW) on Poso River; uses natural outflow from Danau Poso Registered as CDM project in 2012 Danau Poso 323 km2 (32,300 hectares) Key assumptions: 2 ha/mw PV, use maximum 1% of reservoir area to minimize potential environmental and social impacts > 150 MW Image shows 3 x 50 MW floating solar units, using < 1% of reservoir area Requires smart grid to integrate solar and hydro output

Site 3: Estuary at Balikpapan, East Kalimantan Key assumptions: 2 hectares/mw PV Degraded water quality => no size limit based on environmental impacts Indicative layout of 8 x 12.5 MW units = 100 MW (next slide) Design & siting issues: Sites can be identified which do not affect boat/ship traffic Need bathymetry survey Storage / smart grid kit may be required for grid integration Water quality brackish / marine conditions may increase installed cost relative to fresh water Opportunity to deploy prototype electric/hybrid ferry boats?

Balikpapan, East Kalimantan

Balikpapan 8 x 12.5 MW = 100 MW (assumes sites are not in boat/ship channels) Balikpapan

Sites 4 & 5: Danau Towuti, Central Sulawesi Larona 195 MW run-of-river plant (3 x 65 MW), Powerhouse is ~ 5 km downstream of diversion site Balambano 140 MW run-of-river plant (2 x 70 MW), ~ 5 km downstream of Larona powerhouse Karebbe 90 MW, downstream of Balambano The 3 hydro plants provide power for PT Vale nickel ore processing at Soroako Possible to use Danau Towuti 561 km2 (56,100 hectares)?? Or Danau Matana 164 km2 (16,400 ha) which has been directly impacted by mining and mineral processing operations?? Key assumptions: 2 hectares/mw PV, use 1% of reservoir area in Danau Towuti and use < 2% of Danau Matana Opportunity for major overhaul of hydro-generation at Larona (initial operations in 1979) and Balambano (initial operations in 1999)? Smart grid required to integrate solar & hydro output Opportunity to deploy prototype electric/hybrid tourist boats at Danau Towuti

Danau Matana and Danau Towuti area, Central Sulawesi Danau Matana Mining and mineral processing operations

Site 4: Danau Towuti ~ 1% of lake area for 5 x 50 MW = 250 MW Balambano Dam Larona Dam

Site 5: Danau Matana 3 x 50 MW solar using < 2% of lake area Mining and mineral processing operations

Site 6: Palu Bay, Central Sulawesi Large bay > 25 km from north-to-south, > 5 km from east-towest > 125 km2 Protected on 3 sides; ship traffic concentrated on east side, north of Palu city center Key assumptions: 2 hectares/mw PV, use 1% of bay to minimize potential environmental and social impacts ~ 125 hectare Next slide shows indicative installation of 1 x 50 MW unit Smart grid required to integrate solar & hydro output

Palu Bay 1 x 50 MW PV using < 1% of area of the bay

Conclusion Floating Solar PV is a good solution to add large amounts of solar generation capacity, rapidly, cost effectively, and with minimal adverse social or environmental impacts Summary of benefits: Additional electricity generation capacity Optimal hybrid of solar + hydro power generation Ease of grid integration Existing transmission lines at hydropower sites (upgrade only if needed) Modular implement in stages possible to match demand and funding Fast deployment Economically attractive Minimal environmental or social impacts

Solar Parks Model for Floating Solar Public $$ Private $$ Floating Solar PV PPA 1 (25-30 MW) Floating Solar PV PPA 2 (25-30 MW) Government + ADB Finance --> Government uses for: 1. Grid Connection and other Infrastructure 2. Transmission upgrade if needed 3. Hydro-generation upgrade if needed Generation by IPPs. Government provides: 1. Reservoir space concession to locate floating PV 2. Bankable power purchase agreement (PPA) Government leads development to reduce risks, creating a platform for competitive tendering of multiple PPAs, each for 30 MW to 50 MW. Build on experience in India, Cambodia and several other countries. 27

Potential Risks and Mitigation Measures Potential Risk / other issues Limited operational experience no long-term environmental impact analyses Catastrophic failure of floatation systems Possible Mitigation Begin with pilot deployments in areas with no ecological sensitivities Employ rule of thumb of 1-2% of available reservoir area Use modular construction to limit the size of individual rafts so that catastrophic failure of 1 raft does not crash entire system Utilize expertise on floating systems from other sectors (offshore oil & gas, marine engineering, prior experience with barge-mounted power plants, etc.) No deployment in areas with active boat/ship traffic Higher than expected O&M costs Include extended warranty and O&M period in EPC contracts Allow pass-through of additional O&M costs in power purchase agreements First-mover risk ( it hasn t been done because it will not work ) Mobilize concessional finance to cover additional risks and costs on 1 st projects

Next steps Feasibility study for pilot projects including: Initial cost-benefit analysis of construction and operation of floating solar vs. alternatives (e.g. ground-mounted solar, other forms of generation, etc.) Grid integration assessment for specific sites Assess options for storing any excess solar output Create a power operations and dispatch model for the combined operations of solar + hydro and solar + grid to determine economically optimal joint operating regime 29