Jakarta. A consortium of Indonesian and Malaysian companies broke ground on a $2.6 billion hydropower plant in Malinau regency, North Kalimantan on Wednesday.

The Mentarang Induk Hydroelectric Power Plant will power the planned Kalimantan Industrial Park Indonesia (KIPI) in Bulungan.

Kayan Hydropower Nusantara -- a joint venture between Indonesia’s Kayan Patria Pratama (KPP) Group and Malaysia’s Sarawak Energy Berhad -- is building the plant, which is slated to operate in 2030 or seven years from now. 

“I’m delighted to see that the construction of the Mentarang Induk plant has begun, but I’m even happier that an Indonesia-Malaysia consortium is working on this project,” President Joko “Jokowi” Widodo said at the plant's groundbreaking ceremony in North Kalimantan.

“This shows that as brothers of the same roots, we [Indonesia and Malaysia] can really work well together,” Jokowi said.

The 1,375-megawatt power station will generate electricity from the Mentarang river in Malinau. The hydropower plant will connect to KIPI on a 300-kilometer transmission line.  

Jokowi said that the green energy provided by the Mentarang Induk plant would make the aluminum produced by KIPI a “green aluminum”. 

KIPI, which Jokowi claimed would become the world’s largest green industrial park, would also see the production of batteries for electric vehicles (EV), as well as petrochemicals. 

“Because of the green energy generated by the Mentarang River, KIPI’s products will become green and have low carbon emissions. They will have premium prices yet will still remain competitive,” Jokowi said.

According to Jokowi, the government is giving its utmost support for this project, as it would pave the way for Indonesia’s transition towards a green economy.

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