Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing

RMI conducted a pre-feasibility analysis on a high-capacity coal plant in Indonesia, finding that replacing the plant with solar and storage is the preferred solution for maximizing CO2 abatement and investor cash flow, provided sufficient land is available. The analysis highlights the necessity of blended financing to maintain affordable electricity costs during early retirement and notes that biomass co-firing is generally less profitable than other repurposing options. The study emphasizes that land characteristics and regulatory frameworks are critical determinants of a site's repurposing potential.

• Replacing the analyzed Indonesian coal plant with solar and storage is the preferred repurposing solution following early retirement, provided there is adequate land and access to cheap financing. This approach could result in tens of millions of tons of CO2 abated and tens of millions of dollars in free cash flow for equity investors, though the exact benefits depend on the size of the replacement system.
• Blended financing is essential in early retirement scenarios without repurposing to prevent electricity cost increases and make deals more attractive to financial stakeholders by reducing costs compared to running the plant to the end of its technical life.
• Biomass co-firing is typically not profitable because the capital and operational expenses for retrofitting and fueling generally exceed the cost savings. It is only profitable under the lowest assumed cost conditions and faces higher climate and sustainability scrutiny compared to other repurposing options that offer more precise emissions reductions.
• The viability of converting a coal site to a clean energy facility is heavily constrained by land availability. Determining how much additional land around the original site can be used requires further technical and environmental analysis, especially since some surrounding land may be biologically important or environmentally sensitive.
• Certain repurposing options, such as site hybridization with clean energy, reduced asset utilization, and stand-alone storage, were not analyzed because current regulatory frameworks do not provide a model for the remuneration of those services.

APA

RMI (2024). Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing. https://rmi.org/resources/finding-repurpose-the-power-of-a-pre-feasibility-analysis-in-coal-repurposing/

Chicago

RMI. Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing. 2024. https://rmi.org/resources/finding-repurpose-the-power-of-a-pre-feasibility-analysis-in-coal-repurposing/.

Wikipedia

{{cite report |author=RMI |title=Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing |date=23 July 2024 |url=https://rmi.org/resources/finding-repurpose-the-power-of-a-pre-feasibility-analysis-in-coal-repurposing/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2024finding, author = {{RMI}}, title = {{Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing}}, institution = {RMI}, year = {2024}, month = jul, url = {https://rmi.org/resources/finding-repurpose-the-power-of-a-pre-feasibility-analysis-in-coal-repurposing/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }