Speeding Up Energy Transition for a Greener Future

Darmawan Prasodjo

Chief Executive Officer of Perusahaan Listrik Negara (PLN)

PT Perusahaan Listrik Negara (PLN), the state-owned provider of electric power throughout Indonesia, manages power generation, transmission, transformation, distribution and consumption. During COVID-19, PLN posted its best financial results in its history and reduced debt by $4 billion. Mr. Darmawan Prasodjo, Chief Executive Officer of PLN, explained how they achieved it.

Over the past year, governments and people worldwide have been grappling with multiple crises, from the difficult post-pandemic recovery to spiraling inflation and high energy prices. For PLN, we were even predicted by many analysts to experience some kind of financial hardship because of diminishing demands, though we already had some contracts with third parties.

Turning Crisis into Opportunities

Our planet is warming, and reducing greenhouse gas emissions is becoming urgent for every organization and individual. As one of the key players in energy transition, PLN has incorporated energy transition responsibility into one of its main mandates and would like to spare no effort to achieve it. In order to reach this goal, we established a roadmap that aims to increase the renewable energy power plant capacity to 20.9 gigawatts by 2030, as stated in PLN's 2021-2030 long-term electricity procurement plan (RUPTL), which was the most ambitious and greenest national electricity plan in Indonesia.

During the planning of the Indonesian national electricity plan, we aim to reduce 1.8 billion tons of CO2 emissions over a 25-year span, replacing it with renewable energy power plants. Now we are harnessing every single source of renewable energy — hydro, geothermal, solar, and also wind power — to achieve 51.6% additional power generation capacity from renewable energy.

To overcome the threat of climate change caused by greenhouse gas emissions, PLN has declared its roadmap to achieve net zero emissions by 2060 at the UN Climate Change Conference (COP26) in 2021. To realize the target, we plan to increase renewable energy capacity to 20.9 gigawatts in 2030 according to RUPTL. New renewable power plants will dominate power plant capacity by 24.8% in 2030. We will put in place measures that can help reach this target while moving towards stable business development.

Embracing Changes

Unavoidably, the high proportion of new energy access brings more fluctuation on both the demand and the supply sides, which, in the past was predominately driven by the demand side. To minimize the negative impact of the fluctuation, we started digitalizing everything three years ago, including the power plants, the transmission, the distribution and even the smart meter on the customers side. For example, we have modernized the control room and the dispatch center. The additional access of large-scale intermittent and variable renewable energy into our ecosystem will have a large impact on the variability of the generation capacity, requiring us to predict the weather, the speed of the wind and the irradiation of the sun. And then we must calculate the amount of the fluctuations and take appropriate actions, in order to provide safe and reliable power for our customers.

By modernizing our grid into a smart one, improving our generation capacity, and optimizing our dispatch center, we are turning the challenge of energy transition into a new opportunity, making PLN stronger and more ready. So, PLN is shifting from a previously static and backwards-looking company to a company that is dynamic, progressive, and forward-looking.

Activating Dormant Resources

If we describe working on energy transition as going with the flow, then we wish to lead the way by providing broadband services. By partnering with Huawei, we have launched services and completed the market plan of developing 20 million lines within four years, achieving fast asset monetization for customers with only 40% of the investment required with carriers' home broadband development. In the project, PLN and Huawei set up a joint project team, which consisted of experts and designers with more than 20 years of telecom operations experience, providing end-to-end solutions and comprehensive services covering consulting, planning, design, integration, and delivery.

With Huawei's Power Broadband Operations Solution, the assets previously utilized for the electricity services can now be utilized beyond electricity work. With fixed broadband, we provide services for smart homes, ecosystem service for electric vehicles, and the rooftop battery energy storage system.

How does PLN achieve it? Firstly, we have almost a quarter of a million substations with broadband connections. With the fiber optics available in the substations, we have more than half a million distribution transformers scattered all over the country, while there is a fiber optical-ready connection in the neighborhood area. Secondly, there are strong customer demands for the services - fixed broadband penetration in Indonesia, home to the 4th largest population in the world, is only about 18 to 19%, compared to over 55% in neighboring Malaysia and 70 to 80% in Thailand. Finally, PLN is capable of providing premium services in a new way. Take the newly-launched PLN Mobile as an example. As a mobile application downloaded by 37 million users, its rating has been improved from 2.5 for the previous version to 4.9 for its reliable and fast-response customer service now. We are confident on improving customer satisfaction and providing the best services in the new business.

We fully understand that the only way to move forward is through collaboration — collaboration in terms of policy, technology, innovation, and investment.

Partnering with the Right People

We understand our goals, our strengths as well as our weaknesses. Our next step is to come up with a new game plan, and then translate it into effective operations. For this end, we need the right partners.

65% to 70% of our employees at PLN are a young generation eager to tackle the energy transition challenges through innovation. I keep talking with and listening to these agile, nimble, and confident millennials who are hungry to learn and share good ideas and innovations, so we can transform innovative ideas of individuals into collective knowledge.

Meanwhile, we find the same chemistry and resonance in Huawei when we communicate. Both PLN and Huawei emphasize human capacity and technological innovation. Guided by the same direction and goal, we started to support each other and have established a long-term partnership. Looking to the future, we will collaborate again on Indonesia's first Advanced Metering Infrastructure Project, where the Huawei's cutting-edge ICT solutions will play a vital role.

PLN is on a journey to become a green power company. During this ambitious journey, we must expand our power generation capacity to support Indonesia's fast economic growth. We must focus on power capacity expansion with renewable technology. We believe that through digital transformation, PLN will be able to deliver green and smart energy services bundled with Internet and other value-added services to customers.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy, position, products, and technologies of Huawei Technologies Co., Ltd. If you need to learn more about the products and technologies of Huawei Technologies Co., Ltd., please visit our website at e.huawei.com or contact us.