PT Arkora Hydro successfully overcame financing and technical challenges in developing the Cikopo 2 Minihydro Power Plant.
Developing renewable energy power plants and becoming an Independent Power Producer (IPP) in Indonesia is far from easy. The process is lengthy and can take years—from planning to commercial operation. Many renewable energy projects ultimately stall, with no clear timeline for completion.
PT Arkora Hydro Tbk (IDX: ARKO) is one of the IPPs that has successfully completed its project. The company now operates the Cikopo 2 Minihydro Power Plant (PLTM) with a total capacity of 2 × 3.7 MW (7.4 MW). The project took five years, from the signing of the Power Purchase Agreement (PPA) in 2012 to the Commercial Operation Date (COD) in 2017. The results have been encouraging—by 2023, PLTM Cikopo 2 recorded revenue of IDR 45 billion.
How did ARKO succeed in developing this project? And how did the company overcome financing challenges, which are often the main obstacle in renewable energy projects in Indonesia?
Project Origins and the Development Journey of Cikopo 2
ARKO was established in 2010 with a focus on developing and operating run-of-river mini-hydropower plants in Indonesia. Such plants are typically built in remote areas with adequate water resources.
Two years after its establishment, on July 19, 2012, ARKO secured a PPA for the Cikopo 2 PLTM project. This marked the company’s first hydropower project.
Soon after, ARKO commenced construction of PLTM Cikopo 2 in 2013. Four years later, in 2017, the plant officially began commercial operations.
