According to an article in The Jakarta Post, Indonesia State-owned Power Company PT PLN is planning to issue asset-backed securities in a bid to raise capital from debt market a sum between Rp 5 -10 Trillion (USD 376 – 752 Million).

Asset backed securities or structured financing, is a recently popular method of raising capital based on future cash flow, and is gaining traction especially with the rise of recent investor-friendly administration in Jakarta led by President Jokowi. PT PLN said that they would use its subsidiary, Indonesia Power, as a vehicle for the structured financing, basing its future cash flow against the debt. The future cash flow of Indonesia Power will come from PT PLN itself, in which the parent company is required to buy electricity from the Suralaya coal-fired power plant in Cilegon, Banten, built by its subsidiary Indonesia Power.

PT PLN planned to use the capital to build four additional coal-fired power plants, including one at the existing Suralaya power station, with an additional capacity of  2 X 1000MW, and another one in Jambi, with a capacity of 2 X 300MW.

PT PLN further said that it will require Rp 100 Trillion to develop electricity infrastructure across the country, with half of that being set aside for building new power stations while the rest will be allocated for building the transmission and distribution system.

EditorEnergyPowerelectricity,energy,finance,Indonesia,pln,power,structured financeAccording to an article in The Jakarta Post, Indonesia State-owned Power Company PT PLN is planning to issue asset-backed securities in a bid to raise capital from debt market a sum between Rp 5 -10 Trillion (USD 376 - 752 Million). Asset backed securities or structured financing, is a recently...