Geothermal Resource Risk Mitigation (GREM)

GREM is a geothermal exploration financing facility developed by World Bank and Government of Indonesia through PT Sarana Multi Infrastruktur (Persero) (“PT SMI”). The special feature of GREM is the availability of a de-risking facility or a risk sharing scheme at which in the event of an exploration failure, the developer does not fully bear the risks and costs of exploration. The existence of the GREM facility which has a de-risking feature for upstream development is expected to reduce exploration risk as the biggest risk faced by geothermal developers. GREM facility is intended for SOE developers/subsidiaries of SOEs (GREM Public Window) and private developers (GREM Private Window).

The total commitment of GREM funding is USD 651.25 million which comes from a combination of multilateral funds (IBRD, GCF, CTF) and Geothermal Sector Infrastructure Development (PISP) funds. The de-risking component for the GREM Public Window comes from PISP funds with a total of USD 150 million, while for the GREM Private Window it comes from the reimbursable grants of GCF and CTF managed by the World Bank for a total of USD 122.5 million. All funding agreements for the GREM facility have been signed and effective.


GREM Facility for Geothermal Developers

In the GREM facility, PT SMI will support the geothermal exploration activities conducted by the developers through:

  1. Provision of loan and de-risking facilities with a maximum total limit of USD 30 million to public developers (SOE/subsidiaries of SOEs) for exploration drilling stage;
  2. Provision of loan and de-risking facilities (through the purchase of Financial Instruments that are issued by developers) with a maximum total limit of USD 30 million to private developers for exploration drilling stage;
  3. Provision of loan facilities of up to USD 30 million to public developers (SOE/subsidiaries of SOEs) and private developers for delineation/extended exploration drilling stage.


General Criteria for the Recipient of GREM Facility

In the future, this facility is expected to be utilized by geothermal developers and help carry out geothermal exploration activities in Indonesia. With this facility, the exploration risk becomes more measurable, opening a step towards developing electricity production that is sourced from new, renewable and environmentally friendly energy.
Geothermal Resource Risk Mitigation (GREM)

Here are some documents related to GREM:

Developer Manual GREM

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