The World Bank will provide a $300m loan to fund the development of two geothermal projects in Indonesia, which are being delivered by Pertamina Geothermal Energy.

The loan will be used to boost power generation capacity by up to 150MW in geothermal fields in Ulubelu, South Sumatra and Lahendong, North Sulawesi.

The projects, which are expected to be completed in 2015, will displace an equivalent capacity of coal-based power generation, thereby reducing local and global environmental pollution.

The Government of the Netherlands initiated preparatory work for the geothermal projects through funds administered by the World Bank.