Sinar Mas Group plans to develop biomass power plants with a total capacity of up to 1,000MW in South Sumatra, Indonesia, within eight years, in order to meet the energy demand in the country.

Jakarta Post cited Sinar Mas managing director Sulistiyanto as saying to reporters that the company is seeking to enter the commercial renewable energy sector.

Each 100MW of capacity is expected to cost approximately IDR1trillion ($78.55m), thus taking the overall investment of the planned biomass power projects to approximately IDR10trillion ($781m).

Operated by Sinar Mas’ paper-producing subsidiary Asia Pulp and Paper (APP), the power plants will use biomass, which is usually produced from residues of agriculture and forestry operations, to produce electricity for commercial use.

The company is currently negotiating with the government over the projects.

Sulistiyanto said: "We plan to set up a 200-MW plant in the early stages.

Based on transmission to be built, the project would supply power to other regions in the country, reported the publication.

"It will be the first large-scale biomass power plant project. There are currently only small-scale ones operated by HTR [community-based forest] farmers. We want to develop an industrial-scale plant using new technology from Germany.

"The problem is that there’s no reference price stipulated by the government for large-scale biomass plants. There is only a stipulation for those with a capacity below 10 MW."