Sustainability Report 2015


Case studies

Environmental and social support for geothermal power project

North Sumatra, Indonesia

ERM in Indonesia has been working as an environment and social advisor to Sarulla Operations Ltd. (SOL) since 2008 on the Sarulla Geothermal Power Project, located in North Sumatra. The project will develop the steam resources of this area through the construction and operation of three geothermal power-generation units.

SOL is a consortium comprising PT. Medco Power Indonesia, US-based Ormat International, and Japan-based Itochu Corporation and Kyushu Electric Power Company. The 330-megawatt Sarulla project will be the world's largest single-contract geothermal power project to date, providing energy to remote communities in Indonesia while supporting the reduction of crude oil consumption. The electricity produced by the facility will avoid an estimated 1.84 million tons of GHG emissions per year. The project has considered sustainability measures such as minimization of project water demand, re-injection of produced geothermal fluid in underground wells to avoid depletion of gases and release of steam generation from the plant back into the ground to maintain the well.

The financers supporting the project required SOL to comply with a variety of international environmental, social and health policies. In addition to ERM's international experience in project financing, the Sumatra location called for expertise in issues such as endangered species, critical habitats and biodiversity, indigenous peoples, land acquisition and economic displacement. ERM prepared a range of environmental and social reports including the project's Environmental and Social Impact Assessment Addendum, Environmental and Social Safeguards Compliance Audit Report and Corrective Action Plan, Indigenous Peoples Plan, and Land Acquisition and Resettlement Plan.