New proposal would provide renewable energy and manufacturing boost to Indonesia; Australia’s wind and solar resources to generate renewable energy

The Asian Renewable Energy Hub (AREH) is a proposed up to 6-gigawatt wind and solar hybrid power plant in Western Australia’s East Pilbara region that would export its electricity production to Indonesia via subsea electrical cables. The AREH is being developed by a team which includes CWP Energy Asia and InterContinental Energy (leading renewable energy project developers) and Vestas (the world leader in sustainable energy solutions).

While the electricity generated would come from Australia, the wind and solar generating equipment would be manufactured in Indonesia, creating a new source of skilled, high-tech jobs, the development of a local supply chain and technology and knowledge transfer.

By 2025, the AREH would provide the reliable and cost-competitive electricity that would help to meet Indonesia’s energy demand and renewable energy targets.  In addition, AREH would help to address energy security challenges through long-term and stable pricing for electricity, as the wind and sun have no cost and no exposure to future carbon pricing.

The AREH Project

The Project site’s outstanding wind and solar resources can deliver large-scale, stable and competitively priced renewable electricity. The Project’s proximity to Indonesia, combined with advances in subsea cable technology that allow the cost-efficient transmission of electricity over very long distances, result in an opportunity to connect the South East Asia region and to unlock the possibility of developing this large-scale intercontinental renewable energy hub. The first phase of the AREH Project has an initial cost estimate of USD 10 billion, with subsequent phases to include supplying renewable energy to other countries in South East Asia.

The scale of the wind turbines, solar panels and related equipment needed for the Project would be large enough to justify building new manufacturing facilities in Indonesia, thus creating a large renewable energy industrial base that could help reduce the cost of power across Indonesia and the rest of the region, and create thousands of skilled jobs.

The Background

After three years of work developing the proposal and assessing its viability, the AREH Project team are looking to engage potential Indonesian manufacturing, construction and investment partners.

Already, onshore and offshore development studies for the AREH are underway, a team of partners and investors has been assembled, and the Governments of Indonesia, Australia and Denmark – which has a long history of enabling the creating of renewable energy markets – have been engaged. The Project Team has just submitted the Project for environmental review in Australia.

The Team

The AREH Project Team has extensive experience developing and building renewable energy projects in Australia, Indonesia and around the globe. This proven track record, together with input from expert consultants, technology partners and knowledgeable stakeholders has resulted in a validated development and construction strategy. Technology partners Prysmian and Swire Pacific Offshore assisted with the feasibility work and remain engaged in the Project. Prysmian is the world’s leading subsea cable manufacturer and Swire Pacific Offshore is a leading offshore contractor.

“The most important step in developing a project is finding the best site,” said Alexander Tancock, Managing Director of InterContinental Energy. “We spent two years investigating the entire northwest coast of Australia, and found this incredible location. Almost three times the size of Bali; it has a unique geography and topography that gives it far higher wind and solar resources than the average in that area. And those resources are perfectly complementary, with lots of sun during the daytime and high wind speeds in the morning, evening and night. That is why we can deliver such competitively priced power to Indonesia.” 

“Wind and solar energy, working together, have enormous potential to supply reliable and competitively-priced renewable energy across regions,” said Alexander Hewitt, managing Director of CWP Energy Asia.  “Given the increasing ability to move energy over long distances, the Asia Renewable Energy Hub is a compelling proposition for Indonesia – not only for supplying the energy, but for the economic benefits that come with establishing manufacturing facilities in Indonesia.“

“As renewable energy becomes cost-competitive with fossil fuels, it becomes more and more attractive both as source of electricity and as a source of jobs and investment,” said Clive Turton, President of Vestas Asia Pacific. “The Asian Renewable Energy Hub can compete over the long-term as a cost-effective means of supplying energy. It can also provide the foundation for a strong Indonesian renewable energy technology manufacturing hub, driving investment, job creation and a local value-added supply chain.”

You can find more information on the AREH here: www.asianrehub.com