BAWEAN ISLAND 5 MW POWERPLANT PROJECT INVESTMENT ANALYSIS

• Main Author: Wied Hardono, Luddie
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/84720
• Institution: Institut Teknologi Bandung

Bawean Island, located in East Java, has a population of 107,000 and is primarily inhabited by agriculture, fishing, and emigration. The island's natural resources, including beaches, lakes, waterfalls, mountains, and islands, have potential for tourism and economic development. The island is home to an endemic species and a rare species called Rusa bawean, which is endangered. To improve welfare, infrastructure like electricity is needed. Hence, PT PLN (Persero), an Indonesian government-owned corporation tasked with advancing electrification on Bawean Island, Gresik, East Java, intends to allocate funds towards the construction of a new power generation facility. The objective of the study is to assess and compare various investment options with respect to their PLN value in order to identify the most suitable alternative for a new power plant project in Bawean. This will be achieved through an analysis of capital budgeting and the levelized cost of electricity. The study performed a risk analysis to identify the most critical variables that impact the feasibility of the project. Among the three options assessed by PLN, Alternative 2 - build On Grid Solar PV Powerplant (5 MW) is deemed the most optimal. The outcome of the analysis is a Net Present Value (NPV) of 51.70 billion IDR, a Modified Internal Rate of Return (MIRR) of 12.41%, a Profit Index of 1.63, and a Payback Period of 8.60 years. The cost of generation, also known as the levelized cost of electricity (LCOE), is 33% less than that of the current Bawean power plant. According to the analysis evaluation scenario, Alternative 2 is not economically feasible when the project is implemented using scenario 1-3, which involves using HSD to compensate for the reduced capacity factor of PLTS. In sensitivity analysis, the exchange rate and cost of HSD are the variables that have the highest level of sensitivity. The Monte Carlo analysis indicated a 0% probability of a negative net present value (NPV), indicating that the Bawean Project is the most favourable investment option.