PT Perusahaan Listrik Negara (Persero)
This summary covers a proposed investment by Citibank, N.A., Singapore Branch of the United States of America, DBS Bank Ltd. of Singapore, JPMorgan Chase Bank, National Association, Singapore Branch of the United States of America, KfW IPEX-Bank GmbH of Germany, Landesbank Baden-Württemberg Singapore Branch of Germany, Oversea-Chinese Banking Corporation Limited of Singapore, Standard Chartered Bank (Singapore) Limited of Singapore, and PT Bank BTPN Tbk of Indonesia (together, the Guarantee Holders). The Guarantee Holders intend to provide a non-shareholder loan to the Indonesian state-owned enterprise PT Perusahaan Listrik Negara (Persero) (PLN) to finance short-term working capital expenses in relation to the existing renewable power projects by PLN and independent power producers (the Project). The Guarantee Holders have applied for a MIGA guarantee covering up to US$617.5 million of loan principal and future interest for a term of up to 5 years against the risk of Non-Honoring of Financial Obligations by a State-Owned Enterprise (NHFO-SOE).
The proceeds of the Project will be used by PLN to make payments for operational expenses under existing Power Purchase Agreements (PPAs) on a list of pre-identified power projects. The power projects receiving payments under this Project do not include coal-fired or nuclear power stations.
If there are any material changes in the Project’s scope from what has been shared with MIGA at due diligence and presented in this review summary, PLN will provide additional information and MIGA may update the Environmental and Social Review Summary and Environmental and Social Action Plan as needed. Such information disclosure will be governed by MIGA’s Access to Information Policy.
Based on initial environmental and social information received, the Project has been categorized Environmental Category B according to the MIGA Policy on Environmental and Social Sustainability . Click here to view the Environmental and Social Review Summary and Environmental and Social Action Plan prepared by MIGA for this investment in the Project.
The Project is expected to contribute to an easing of pressures on PLN’s working capital stemming from potential negative economic effects driven by the COVID-19 global pandemic due to weaker demand for electricity on the back of subdued economic activity and potential currency valuation effects.
MIGA’s support for this Project is consistent with MIGA’s US$6 billion COVID-19 response package as well as the World Bank Group’s COVID-19 responses to assist member countries in addressing the global pandemic and its impacts. The Project is also aligned with the World Bank’s country engagement of supporting sustainable energy and universal access in Indonesia.