The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance and credit enhancement arm of the World Bank Group, announced today that it is supporting the development and operation of a 47-megawatt run-of-the-river hydropower plant and the construction of a transmission line inIndonesia. The new facility will help reduce the country’s reliance on expensive fuel oil by providing a more affordable and cleaner supply of power to PT Perusahaan Listrik Negara (PLN), Indonesia’s state-owned electric utility company.
MIGA is providing guarantees of up to $200 million to the project’s lenders–theJapan Bank for International Cooperation (JBIC) and Mizuho Bank Ltd. MIGA’s coverage is against the risks of transfer restriction, expropriation, war and civil disturbance, and breach of contract. The project is near the center of Cianjur,West Java in the upper reaches of the Citarum River. It will use the difference in height between the Saguling and the Cirata hydroelectric power plants to generate electricity.