Indonesia’s power grid will be boosted by eight mobile power plants, to be financed by the export credit agencies of Canada and Hungary.

In total, 500MW will be added to the grid, primarily outside of Java, in regions with low electrification rates. The finance, totalling US$435mn, comes in 12-year loans jointly funded by Export Development Canada (EDC) and the Hungarian Export-Import Bank (Hexim).

The borrower is state-owned electricity board PLN, which has been set a target of adding 35,000MW to the grid by 2019.

“These mobile power plants are expected to make electricity procurement reach Indonesia’s remote areas so the economy can grow and the 99.7% electrification ratio target in 2019 can be achieved,” says PLN communciations head I Made Suprateka.

The plants will utilise Tm2500 gas turbines made by GE. Fifteen of the 20 to be used will be made in Hungary, with the remaining five made in Canada.

CEO of Hexim Zoltán Urbán estimates that the deal will make Hungary Indonesia’s number one trading partner in the Central and Eastern European region, and that it will add more than HUF25bn to the Hungarian economy.

The details of the eight power plants are as follows: Lampung (4 x 25MW), Pontianak in West Kalimantan (4 x 25MW), Bangka (2 x 25MW) in Bangka Belitung, Riau (3 x 25MW), Belitung in Bangka Belitung (25MW), Ampenan in West Nusa Tenggara (2 x 25MW), Paya Pasir in North Sumatra (3 x 25MW) and Nias (25MW) in North Sumatra.