SBY woos Malaysian investors to invest in clean energy

M. Taufiqurrahman, The Jakarta Post, Kuala Lumpur

The government appears to be serious about cutting its dependency on fossil fuel and pursuing the use of alternative energy derived from biofuel.

As part of efforts to expedite the development of bio-fuel plants in the country before 2009, President Susilo Bambang Yudhoyono held meetings last Friday with Malaysia's top energy companies, offering incentives for them to invest in bio-energy.

Top executives from Genting Plantation and Biodiesel; Sime Darby Berhad; Khazanah Finance, Telecommunications and Infrastructure; and Petronas met Susilo in turn prior to a roundtable discussion held by the Kuala Lumpur Business Club -- an influential lobby group in Kuala Lumpur.

Speaking after a meeting, Minister for Energy and Mineral Resources Minister Purnomo Yusgiantoro said that among incentives the government could offer were the role of the state gas and oil company Pertamina and state power firm PT PLN as stand-by off-takers that would buy biofuel produced from future plants.

Purnomo also said that a team would soon draw up regulations that would ease the way for foreign companies to invest in the bio-energy sector. "We hope that all the necessary regulations will be ready by the year 2008 and we can start production in 2009," Purnomo said.

Industry Ministry Fahmi Idris said separately that other revised regulations would concern, among other things, income tax and land.

"We consider the biofuel industry to be strategic and labor-intensive and thus deserving of special treatment," Fahmi said.

The government has said it expects that the use of biofuel will make up 10 percent of the country's energy consumption by 2009, enough to reduce the burden of the state budget in shouldering the fuel subsidy allocation.

Purnomo said that among companies that had agreed to set up biodiesel plants in Indonesia was Genting Berhard, also known as one of the leaders in Malaysia's hospitality and leisure industry.

"Genting has agreed to invest for 1 million hectares of land. We don't know where as yet, but it will definitely be outside Java," Purnomo said.

The chairman of the biodiesel division of Genting, Berhad Lim Kok Thay, said the company was greatly interested in investing in biofuel and his company would soon build biodiesel plants in Indonesia.

"We are hoping that we can cross the bridge and I told the President that I would jump on the next plane to invest there," Lim said.

He said that Genting was no stranger to the biodiesel business. "We have invested in the field without being too well-known. We are in fact Malaysia's leading company in biodiesel," he said.

Lim, however, will remain cautious about investing here.

"The President did invite us to participate in the so-called green energy industry, but we have to be careful in terms of what biodiesel means."

Speaking during a roundtable discussion with the KLBC, Yudhoyono said that resorting to biofuel was part of the government's efforts to strengthen the security of the country's energy supply.
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