A supercritical-pressure coal-fired power generation plant in Indonesia is to start full-scale construction work following the signing of a project financing loan agreement.

The 815MW plant forms the third phase of expansion for the Paiton Thermal Power Station to be delivered to PT Paiton Energy, an independent power producer (IPP) jointly established by companies in Japan, the UK and Indonesia.

The construction work follows a $1,215m project financing agreement signed by PT Paiton Energy with the Japan Bank for International Cooperation (JBIC) and eight commercial banks in this month.

The steam turbine and boiler will be supplied by Mitsubishi Heavy Industries (MHI) and the construction will be undertaken by TOA Corporation of Japan.

The plant is expected to ease a crunch in electricity supply. Power from the plant will be sold to Indonesia’s state-owned power utility, PT PLN (Persero) for 30 years.

The plant is expected to begin commercial operation in 2012.

Supercritical-pressure coal-fired power generation provides higher generation efficiency than subcritical-pressure generation, reducing coal consumption relative to power output, resulting in lower emissions.