Hydro Power – Advisory and Consultancy Services for the Indonesia Investment Agency (PIP)

This 2012 DFID program aimed to strengthen the capacity of the Indonesian Investment Agency (Pusat Investasi Pemerintah, PIP) to lend for hydropower projects of up to 10 MW and in turn support the Ministry of Finance (MoF) in delivering its mandate to finance renewable energy projects as part of the National Action Plan on Reducing GHG Emissions (RAN-GRK 2010).

Castlerock’s work consist of following activities broadly  :

  • Capacity Building. Castlerock prepared an internal Investment Manual for the evaluation, structuring and processing of loans for hydro power projects, and has delivered training on the application of the Investment Manual. The Manual and associated training include a comprehensive lending framework for hydropower development, due diligence checklists covering technical, commercial, legal, environmental and social aspects, and a credit review and approval process.
  • Project Specific Assistance. Castlerock advised PIP on the review of loan applications it has received from developers for specific projects. Castlerock reviewed three hydropower project proposals and identified areas that PIP needs further information from the developer. For one of the projects, Castlerock helped PIP prepare and issue a Letter of Interest, including draft credit agreement and terms sheet, to advance the project loan.