Enel Green Power (EGP), a renewable energy unit of Italian firm Enel Group, in partnership with Indonesian geothermal developer PT Optima Nusantara Energi (PT ONE) has secured the license to develop the 55MW Way Ratai geothermal power project.

The project is slated to come up in the Way Ratai area in Indonesia’s Lampung province.

The partners have been awarded the exploration and development license for the Way Ratai project following a tender launched by the Indonesian Ministry of Energy and Mineral Resources in 2015.

That auction is part of the country’s plan to raise the renewables share in its energy mix from current 12% to up to 23% by 2025.

A special purpose vehicle (SPV) will be launched by EGP and PT ONE for the project. Enel will have majority stake in SPV.

The project is expected to generate around 430GWh per year.

Power generated from the geothermal plant will be sold to the national utility PLN under a 30-year power purchase agreement (PPA).

Enel plans to invest up to $30m in the exploration phase of the project, marking an entry into Indonesia’s renewables market.

Enel CEO and general manager Francesco Starace said: “Indonesia is the largest economy in Southeast Asia and one of the world’s main emerging markets. This award represents a first step forward for the growth of Enel’s activities in the area.

“The award is also the starting point from which we intend to build a solid platform for future investment opportunities in the country.

“We are leveraging on the latest technology and our solid experience in the geothermal field, in collaboration with our partner, to contribute to Indonesia’s ambitious energy plan for an increased share of renewables in the country’s energy portfolio.”

Based on the results of the exploration phase, the project construction is expected to be completed and be commissioned in 2022.