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Home › Dodgy Deals ›
Dodgy Deal
Batang Coal Power ProjectIndonesia

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

Arif Fiyanto, Greenpeace South East Asia

Last update: 2016-10-18 00:00:00
protest against project. Photo: Greenpeace

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

Arif Fiyanto, Greenpeace South East Asia

Last update: 2016-10-18 00:00:00
Why this profile?

What must happen

The World Bank should immediately cease financing Batang as it goes against its new policy to quit supporting coal projects worldwide. It should also ensure its existing projects conform to its new standards and embrace more geothermal and other renewable energy projects in Indonesia. JBIC should immediately pull out of the project as it does not comply with its own standards. It lacks social acceptability and the project is not lawful, as is required by JBIC Guidelines.

Japan, which has also played a major role in pushing the dirty Batang plant, must cease peddling its coal projects in Asia, and embrace clean energy as it promised to, after the Fukushima disaster. The Indonesian government should spent the requisite USD four billion on cleaner, more sustainable, renewable energy solutions.

Commercial banks must not participate in the financing of this project in any way. 

About
Sectors Coal Electric Power Generation
Location
Status
Planning
Design
Agreement
Construction
Operation
Closure
Decommission
Website http://www.bhimasenapower.co.id/
This project has been identified as an Equator Project

Batang coal-fired power plant (2,000 megawatt) will be one of the biggest coal-fired power plants in Asia. It will cost approximately JPY400 billion (USD four billion). Japanese companies J-POWER and Itochu are major players in the project. The Japanese Bank for International Cooperation (JBIC) and private banks are under consideration for the financing. The Japanese government is likely to promote the project under the public-private partnerships (PPP) scheme.

The Batang power plant will be built by PT Bhimasena Power Indonesia (BPI), a local company which is a joint venture of J-Power, Adaro and Itochu. It was established in a build-operate-transfer (BOT) scheme and will operate as an independent power producer. It signed a 25-year power purchase agreement (hereafter referred to as PPA), with the Indonesian State Electricity Company (PLN) using the BOT scheme. This will be the first PPP project based on an Indonesian Presidential Decree.

The power plant will be fuelled by Indonesian sub-bituminous coal and will use Ultra Super Critical (USC) technology. This is why Japan is such a big sponsor of the project, as it will be exporting this technology to Indonesia.

Impacts

Social and human rights impacts

The Batang locals have voiced their concerns about the negative health effects the project will bring as well as the impact it will have on their livelihood which is so heavily dependent on the fertile agricultural land and fishing area. These concerns are not only isolated to the local area, but have also reached the capital of Jakarta where a protest was held in front of the Japanese embassy. However, in an attempt to repress the locals' protests, the military and police took violent action which resulted in several injuries.

More than 7,000 villagers have expressed concern over the proposed power plant. Fifty local landowners have refused to sell 55 hectare of land that is needed for the proposed 226 hectare power plant. The local community has protested on 22 occasions, both locally as well as in Jakarta. On July 22, 2013, about 180 Batang locals protested at the Japanese embassy in Jakarta. The following week, on July 30, local authorities and the military resorted to taking violent action against protestors, which resulted in 17 injuries, according to local news reports.


Environmental and climate impacts

Local people are concerned about the plant's impact on their livelihood and health. Construction will destroy fertile agricultural land. Emissions from the plant will pollute local coastal areas where more than 10,000 fishers earn their living. It is estimated that the facility can emit some 226 kg of mercury per year. Just 0.907 grams of mercury in a lake has the potential to make fish in a one hectare area unfit to eat.

The proposed power plant infringes upon the Ujungnegoro-Roban coastal area, which is protected as a Marine Protected Area and Local Sea Tourism Object under Government Regulation No. 26/2008. Part of the power plant will be built at sea and infringes upon a protected area, in direct violation of Central Java provincial bylaw No 6/2010 on spatial planning.

There have been major initiatives by the Indonesian government to combat climate change. In 2009, the government pledged to reduce its greenhouse gas emissions by 26% by 2020. However, the Batang power plant alone is likely to emit 10.8 million tonnes of CO2 per year. If coal fired power plants continue to be built, Indonesia's energy sector emissions could double by 2020. If we are to have any chance of avoiding catastrophic climate change, according to scientists, we must limit global temperature rises to two degrees Celcius from pre-industrial level.


Other impacts

The AMDAL process (Indonesian Environmental Impact Assessment) failed to include the community concerns and voices. Instead of being participatory or taking note of local residents' protests, it ignored the community's very explicit resistance. Indeed, the community's response was completely excluded from the record of the AMDAL hearing. The final AMDAL forum minimized the participation of registered, verifiable residents and included the participation of groups with no prior track record and no verifiable connection to the community, or to the land. Residents allege that some of these participants were brought in from farther afield by the company and the local government in order to drown out the community's voice.

Strong-arm tactics employed against farmers opposing this coal project In Batang Regency, on the north coast of Central Java, Bhimasena Power Indonesia (BPI) has made way for a massive coal power plant project in part through strong-arm tactics against local farmers opposed to the project. In this report, farmers talk about the anger and frustration they feel about being fenced off from their land and livelihoods, harassed by security guards. “Farmers, landowners and others who reject the coal power plant often receive threatening text messages. In other cases, paid thugs have visited residents’ houses, intimidating them to sell their land.” Lembaga Bantuan Hukum (LBH) Semarang, a legal aid organization that has been working with the community, also says a deception tactic is being used in which the company makes it seem as if they’ve already acquired large amounts of land as a way to pressure residents who have not yet sold (source www.corruptionincoal.org).

Financiers
Institution type
Finance type
Year
Companies

Alamtri Resources Indonesia (formerly Adaro Energy Indonesia)

Indonesia
Profile
Website
It owns 34% of the joint venture PT Bhimasena Power Indonesia.

Itochu Corporation

Japan
Website
It owns 32% of the joint venture PT Bhimasena Power Indonesia.

J-power

Japan
Website
It owns 34% of the joint venture PT Bhimasena Power Indonesia
No companies
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Protests Against Coal-Fired Power Plant in Central Java

2017-03-30 | Batang | Jakarta Globe
BankTrack news BankTrack blog Partner news Partner blog

Indonesian Batang Villagers Filed the Objection against JBIC

2016-12-05 | Friends of the Earth Japan
BankTrack news BankTrack blog Partner news Partner blog

Japan's export bank agrees USD3.4 billion loan for Indonesian coal station

2016-06-06 | Reuters
Blog
BankTrack news BankTrack blog Partner news Partner blog

BankTrack condemns Japanese and Singapore bank financing of Batang coal project in Indonesia as reckless to people and climate

2016-06-06 | Nijmegen, The Netherlands | BankTrack
BankTrack news BankTrack blog Partner news Partner blog

ITOCHU announces execution of loan agreement for central Java coal-fired IPP project in Republic of Indonesia

2016-06-03 | Yourprojectnews.com
BankTrack news BankTrack blog Partner news Partner blog

Why coal is a bad bet for Indonesia’s future

2016-05-27 | Hellenicshippingnews.com
BankTrack news BankTrack blog Partner news Partner blog

JBIC undecided on USD four billion Indonesia power project -CEO

2016-04-22 | Reuters
BankTrack news BankTrack blog Partner news Partner blog

NGO, locals seek to halt Central Java coal power plant project

2016-04-07 | The Jakarta Post
BankTrack news BankTrack blog Partner news Partner blog

Supreme Court ruling paves way for Batang megaproject

2016-03-02 | The Jakarta Post
BankTrack news BankTrack blog Partner news Partner blog

Greenpeace, locals urge Jokowi to halt construction of USD four billion Batang Power Plant

2015-10-07 | Jakarta Globe
BankTrack news BankTrack blog Partner news Partner blog

Batang power plant project faces further delays

2015-10-02 | The Jakarta Post
BankTrack news BankTrack blog Partner news Partner blog

In Japan, Indonesian Villagers File Official Complaints on Batang Coal Plant

2015-08-12 | Endcoal.org
BankTrack news BankTrack blog Partner news Partner blog

Indonesia delays closing on controversial Japan-funded power plant

2014-10-07 | Global Post
BankTrack news BankTrack blog Partner news Partner blog

An Unwelcome Development of Coal-Fired Power Plants

2014-09-25 | Jakarta Globe
BankTrack news BankTrack blog Partner news Partner blog

Central Java Villagers Take Power Plant Fight to Japan

2014-09-10 | Jakarta Globe
BankTrack news BankTrack blog Partner news Partner blog

Batang Coal-Fired Power Plant – Human Rights Violations Continue, Residents Attacked Again in Violent Clash with Police

2014-05-12 | No Coal, Go Green
BankTrack news BankTrack blog Partner news Partner blog

Indonesian Community Leaders Arrested For Coal Activism

2014-05-09 | Huffington Post
BankTrack news BankTrack blog Partner news Partner blog

Indonesia racing to beat power deficit as new project delays loom

2014-04-25 | Reuters
BankTrack news BankTrack blog Partner news Partner blog

J-Power, Partners Delay $4 Billion Indonesia Coal Power Plant

2013-10-04 | Bloomberg Businessweek
BankTrack news BankTrack blog Partner news Partner blog

Batang Coal-fired Power Plant Will destroy health and livelihoods

2013-04-03 | Greenpeace Indonesia
Resources
Documents
Images
Videos
Links
2016-06-06 00:00:00

Statement on JBIC by Friends of the Earth Japan.

NGO document
2016-06-06 00:00:00 | Friends of the Earth Japan
2016-05-31 00:00:00

SUMMARY OF Environmental and Social Impact Assessment Central Java CFPP Project

Company document
2016-05-31 00:00:00 | POWER Engineers Oradell
2015-01-09 00:00:00

Japanese Banks' Involvements in Human Rights Violations based on 4 Cases

Executive Summary of Fair Finance Guide Japan 1st Case Study
NGO document
2015-01-09 00:00:00 | Published by A SEED JAPAN, JACSES and PARC
2014-03-29 00:00:00

The True Cost of Coal

NGO document
2014-03-29 00:00:00
2013-09-30 00:00:00

WORLD BANK ACCELERATING COAL DEVELOPMENT IN INDONESIA

NGO document
2013-09-30 00:00:00 | OilChange International

Twelve activists block construction of Batang coal power plant, March 2017

2017-04-04
Blockade6 Batang march 2017 Blockade5 Batang march 2017 Blockade 4, Batang, March 2017 Blockade3 Batang march 2017 Blockade2 Batang march 2017 Blockade1 Batang march 2017

Protest at Japanese embassy in Jakarta by Indonesian farmers and activists, 6 December 2016

2016-12-06

Fishermen protest against power plant development in Batang, Central Java, November 2016

2016-12-02
JG Photo/Yudhi Sukma Wijaya

Greedy for coal, an Indonesian company takes farmers’ land

2017-05-22 11:34:14

Perjuangan Masyarakat Batang melawan Perusakan Lingkungan oleh PLTU

2014-05-28 11:00:25

No Coal! Go Green! – No to JBIC's coal financing! project

Updates

2016

2016-12-06 00:00:00 | Farmers Stage Rally at Japanese Embassy in Jakarta over Coal-Fired Plants

JAKARTA – Dozens of Indonesian farmers and environmental activists gathered on Monday 6th of December outside the Japanese embassy in Jakarta to demonstrate against the expansion of coal power plants, with which the Indonesian government hopes to drive the electrification of the archipelago. The farmers, hailing from Batang district in Central Java province of Indonesia, threw dirt and paddy rice on a tarp in front of the embassy in a symbolic display of their livelihoods, which will be in jeopardy if the $4-billion coal-fired plant partially financed by the Japanese government goes ahead. Greenpeace joined the rally to raise the issue of greenhouse gas emissions as well as health risks caused by toxic mercury pollution to the 15,000-person strong communities in the vicinity of the plant. “Every new coal-fired power plant means elevated health risks for Indonesians. Lives, including those of children, are cut short due to strokes, heart attacks, lung cancer and other cardiovascular and respiratory diseases,” said Greenpeace’s climate and energy campaigner Arif Fiyanto, who urged the Indonesia government to source more sustainable sources of energy. Read more here.

2016-07-18 00:00:00 | Case filed against J-Power and ITOCHU

The Japanese NCP (National Contact Point OECD) has accepted the OECD Guidelines case filed against J-Power and ITOCHU by 23 community leaders related to the construction and operation of a coal-fired power plant in Batang, Central Java, Indonesia. The complaint outlines human rights violations committed by Bhimasena Power Indonesia (BPI), the joint-venture the two companies helped establish to construct and operate a coal-fired power plant in Batang. More information on the specific cases: J-Power, ITOCHU. (source OECD Watch).

2016-06-03 00:00:00 | Project Finance and Political-Risk Guarantee for Central Java Coal-Fired Power Generation Project in Indonesia

The Japan Bank for International Cooperation on June 3 2016 signed a loan agreement amounting to approximately USD2,052 million (JBIC portion) with PT Bhimasena Power Indonesia (BPI), an Indonesian company invested in by Electric Power Development Co., Ltd. and ITOCHU Corporation etc., for the Central Java coal-fired power generation project in Indonesia. The loan, provided in project finance, is cofinanced with Sumitomo Mitsui Banking Corporation, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Mizuho Bank, Ltd., Sumitomo Mitsui Trust Bank, Limited, Mitsubishi UFJ Trust and Banking Corporation, Shinsei Bank, Limited, The Norinchukin Bank, and two Singaporean entities, DBS Bank Ltd and Oversea-Chinese Banking Corporation Limited, with a total cofinancing amount of approximately USD3,421 million. JBIC provides political risk guarantee for the portion financed by private financial institutions. Source: JBIC.

2015

2015-10-07 00:00:00 | Greenpeace, locals urge Jokowi to halt construction of USD four billion Batang Power Plant

Jakarta. Residents of Central Java's Batang district, alongside environmental activists,  rallied at the State Palace calling on President Joko Widodo to halt construction of a 2,000 megawatt coal-fired power plant, arguing that land procurement for the plant is still not finalized ten years after the project was launched. "Time is up for the Batang coal-fired power plant," Arif Fiyanto, head of climate and energy campaigning at Greenpeace Southeast Asia, said.

2015-09-04 00:00:00 | Jokowi’s misleading view of Batang plant

According to the Jakarta Post:  President Joko "Jokowi" Widodo attended the ground-breaking ceremony that marked the start of construction of the Batang coal-fired power plant in Central Java, although no ground was broken that day. With his speech he hoped to instill optimism and confidence that construction of the massive coal plant will begin imminently, as though all of the project's problematic financial issues had been resolved.

However, the reality is that the power plant has been delayed for nearly four years now due to persistent opposition from the local villagers living near the project site. Today, dozens of landowners are still refusing to sell their land. They own around 10 percent of the 226 hectares needed for this mega-project.

2014

2014-02-03 00:00:00 | Current situation

  • The guarantee agreement for the Batang power plant project was signed on October 6, 2011 and the deadline for loan procurement was set one year later. But due to local opposition to the project and failure to secure enough land, only about 80% of the estimated land has been secured. The deadline to acquire enough land was extended two years in a row, until 2014.
  • Construction was set to begin in October, 2012. Unit 1 and Unit 2 are planned to begin operations at the end of 2016 and mid-2017 respectively. However, it is expected that operations will not begin as planned.
  • JBIC is still currently conducting the environmental review for this project.
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